Flooring specialist upbeat on half-year profit levels
Bury-based flooring specialist James Halstead continues to see strong trading conditions, including overseas opportunities such as a deal for the Big Brother house in Portugal among its projects.
In a trading update for the half year to December 31, 2020, ahead of its interim results on March 31, it said it expects pre-tax profits will be in line with last year’s record levels.
It said the backdrop to the trading period remained challenging with the resurgence of the COVID-19 virus and subsequent lockdown restrictions across most of its trading territories.
Nevertheless, the normal course of business has evolved and the group continues to trade at normal levels through the various national lockdowns, but it admitted it has been hard work.
The cost and availability of international freight towards the end of the period has also been a major issue – and there has been upward pressure on raw material costs.
In his AGM statement, on November 12, 2020, chairman, Anthony Wild, noted that trading to date had been encouraging in terms of turnover for the first four months of the current financial year with sales on a par with the levels of last year.
This trend continued through November and December.
Diverse projects using the group’s flooring include a 10 cinema IMAX complex in Aruba, the AXA Insurance Towers in Casablanca, several modular hospital contracts in Argentina and the Big Brother house in Portugal.
Turnover has been solid and the group believes this is a creditable performance against the prevailing market conditions.
There was noticeable market share growth in the UK in November and December, due in part to Brexit concerns of customers about supply from European-based competitors.
Underlying margins were under pressure due to increased shipping costs, both into the UK and on exports, plus the difficulties of manufacturing during the six months owing to understandable manning problems.
Notwithstanding this adversity, the company said it expects to report pre-tax profit for the half-year in line with last year’s record level.
The balance sheet remains robust, with cash balances above the year end in June and the comparative for December 2019.
