Manufacturer looks for green light on return to profitability
LED lighting group Luceco expects to return to profit in the second half of this year after putting a turnaround plan in place.
The Telford-based manufacturer is seeing positive signs despite “fragile” consumer confidence, with a 30% increase in its UK retail order book for the third quarter.
However it recorded a £4.4m pre-tax loss in the first half of 2018 – a £10m drop from a year earlier – although revenues were only down a fraction, to £75.1m.
Luceco’s chief executive John Hornby acknowledged “a disappointing financial performance” caused by a challenging sales, pressure on margins and unfavourable exchange rates.
He added: “However, we have already put into place a number of actions that will deliver an improvement in the Group’s financial performance in the second half of the year with a return to profitability expected.”
Luceco floated in October 2016, which valued the company at £209m, and it had a good first year on the London stock exchange.
But difficult trading conditions have been reflected in a declining share price – Friday’s close of 50p was 80% below its value in September 2017 – and its market value is now around £80m.
It has now closed its loss-making US operations and will focus on “its other more attractive and successful international markets”. The closure cost £2.0m and 19 jobs.
