Ultimate Products confident after robust interim performance

Oldham consumer goods group, Ultimate Products, reported better interim sales today, but pre-tax profits slipped back by five per cent due to higher interest rates and the group’s head office investment increasing the depreciation charge.

The owner of homeware brands such as Salter and Beldray saw sales rise two per cent to £87.6m in the six months to January 31, 2023, while a pre-tax profit of £9.3m was down from £9.8m in the same period a year ago.

Online revenue was up 78% to £22.9m, supported by continued normalisation of global supply chains, while sales to retailers were down 11% to £64.7m, hampered by caution in forward ordering arising from post-COVID overstocks amongst retailers.

The board has recommended a six per cent increase in the interim dividend of 2.43p per share.

The business said it has strong cash generation from operating activities of £12.8m, compared with used cash of £5m a year ago, representing a 114% operating cash conversion.

Ultimate Products expects its annual 2023 performance to be in line with current market expectations, which are for revenues of £165.3m (actual 2022: £154.2m), adjusted EBITDA of £20.1m (actual 2022: £18.8m) and adjusted EPS of 14.8p (actual 2022: 14.3p).

During the period the group appointed its first dedicated brand director, completed the successful relaunch of Petra, the German kitchen electrical brand, into the German market, renewed its Russell Hobbs licencing agreement on a rolling four-year basis and launched its inaugural ESG Strategy.

It also invested in robotics yielding positive results, with hundreds of tasks now automated and has begun the journey to diversify its supply chain.

Chief executive, Simon Showman, said: “We have delivered a robust performance, with exceptional growth from online, amidst a tough trading environment. Our amazing team has built a resilient and scalable business, based on a strong portfolio of homeware brands with a wide range of products and channels to market.

“The business has been tested by some of the toughest trading conditions and headwinds seen in recent times, but we are emerging stronger, more focused and more profitable than ever.

“This resilience puts us in a strong position to accelerate our growth as the macroeconomic uncertainty starts to clear. We, therefore, remain confident in the future prospects for Ultimate Products.”