Ultimate Products produces strong 2019 results and is confident for current year

Ultimate Products, the Oldham firm which designs and develops low cost consumer products, reported better revenues and profits for the year to July 31, today.

Sales jumped 40.8% to £123.3m, while pre-tax profits soared by 51.1% to £8.2m.

International revenues were up 101.8% to £48.5m, making up 39.4% of the group’s total revenues, while online revenues improved by 63.2% to £11.4m.

Net debt rose from £12.8m a year ago to £14.4m, while bank facility headroom of £10.1m compared with £9.1m previously.

The full year dividend of 4.085p per share showed a 50.2% improvement.

Chief executive Simon Showman welcomed the annual results, saying: “We are delighted to have delivered substantial revenue and profit growth against such a challenging economic backdrop.

“It is particularly pleasing that this growth has been broad-based across all of our channels and customer types, with our online and international businesses continuing to trade particularly strongly.

“Our broadening customer base and the ongoing development of our portfolio of outstanding brands means that we have greater sales and profit diversification than ever before.

“This has been achieved while maintaining the high levels of service and operational excellence that our customers have come to expect from Ultimate Products, and which set us apart from our competitors.”

He added: “The market conditions for general merchandise remain challenging in the UK and Ultimate Products, like many others, is faced with an uncertain environment for consumers, retailers and suppliers.

“However, current trading is in line with expectations and the FY 20 order book is moderately ahead of this time last year. Therefore, despite the wider market uncertainty, we remain confident in the future prospects of Ultimate Products.”

Ultimate Products sells to more than 300 retailers across 38 countries.

It has six product categories: Audio; heating and cooling; housewares; laundry; luggage; and small domestic appliances.

Its brands include Beldray (laundry, floor care, heating and cooling), Intempo (audio), Salter (kitchenware), Constellation (luggage), and Progress (cookware and bakeware).

Founded in 1997, Ultimate Products is headquartered in Oldham, where it has design, sales, marketing, buying, quality assurance, support functions and warehouse facilities across two sites.

In addition, the group has an office and showroom in Guangzhou, China and in Cologne, Germany, and employs a total of 290 staff.

During the first quarter of the current financial year the group successfully launched its offer in Germany on a major online platform there and now has the template for a pan-European roll-out which it plans to execute during the rest of the year utilising third-party logistics.

It said: “This is an exciting new development for the business and we will be investing in additional headcount to facilitate this.”

Furthermore, it said during the current financial year it plans to invest £1.8m in its head office to provide the additional capacity for future growth and a better quality workspace for colleagues.

“We see this as an important next step in our recruitment and retention of key talent, including through our Graduate Development Scheme, as well as giving sufficient headroom for growth for the foreseeable future.”

On Brexit it said the board continues to assess the implications of a ‘no deal’ Brexit and the potential impact on volumes and margins if it led to a material devaluation in Sterling.

However, in the longer term, the board is confident in the adaptability and resilience of the group’s business model, as evidenced by the strong recovery in trading in financial year 2019, despite a challenging consumer and retail market.

Today’s report said the market conditions for general merchandise remain challenging in the UK and Ultimate Products, like many others, is faced with an uncertain environment for consumers, retailers and suppliers.

Despite these challenges, the group has delivered strong growth and a good set of results through a relentless focus on its strategy.

It added: “Current trading is in line with expectations with the FY 20 order book moderately ahead of this time last year and, while the conditions in the UK look set to remain challenging, the board remains confident about the group’s future prospects.”