International growth tempers profit fall at Graham & Brown
FAMILY-owned Lancashire wallcoverings group Graham & Brown has reported a boost in overseas sales, but annual profits fell due to higher raw material costs.
The goup, founded just after the end of World War 2 by friends Harold Graham and Henry Brown, works with well-known home fashion designers such as Laurence Llewelyn-Bowen, Kelly Hoppen and Wayne Hemingway.
Based in Blackburn the company now has more than 600 staff. Demand from emerging markets in the Far East, Middle East, North Africa and Russia for its British-made products saw international sales rise 4.3% from £45.7m to £47.7m in the 12 months to December 2011.
Over the last three years, export sales have increased 50%. Overall turnover in the year grew 0.5% from £90.07m to £90.56m due to the impact of a more challenging climate in the UK retail sector.
The group’s operating profit fell from £3.8m to £1m and bottom line profits from £3.7m to £890,000 during the same period, due to a combination of rising commodity prices and significant investment in its international presence.
Profits are expected to recover in the current financial year thanks to a series of cost reduction initiatives implemented last year and greater stability in raw materials costs.
Graham & Brown manufactures wallpaper products across a portfolio of market-leading brands, which include Graham & Brown, Superfresco, Superfresco EASY and Contour.
With a 200,000 sq ft manufacturing, and design and marketing centre in the UK, the group also operates sales offices in the US, France, Holland, Russia, Canada, China and Germany and works with dozens of distributors in other territories.
Andrew Graham, chief executive officer of Graham & Brown, said: “Our combination of ‘Made in Britain’ heritage and contemporary design has helped us penetrate key overseas markets, particularly the Far East, Middle East, North Africa, Russia and Eastern Europe, where we continue to invest in our market presence.
“These are markets where domestic wealth creation and increasingly international tastes in premium wall decoration are driving demand for our brand.
“Our international strategy is based on a long-term commitment to consolidate themajor global markets where we already have traction as well as penetrating new, faster growing markets.”
He added: “Whilst the global economy remains challenging for most consumer products manufacturers, we remain focused on delivering exciting new designs, both in house and in partnership with some of the world’s leading interior designers, as well as technical innovations to drive market growth across our markets.”
As well as distributing its products via major retailers, such as B&Q and Homebase in the UK, the business also supplies over 150 Graham & Brown branded outlets overseas.
The founders’ sons, Roger Graham and David Brown, are joint chairmen and last week director Ian Brown, grandson of founder Henry, was named the Institute of Directors’ North West Director of the Year.
