Homeware brands group suffers from strong prior year performance
Full year unaudited results for Oldham-based homeware brands group, Ultimate Products, have confirmed fears of a slowdown, after a Christmas rush for air fryers skewed prior year results.
But it said it is seeing evidence of a healthy order book for the current financial year.
Ultimate Products warned, in a market update three months ago, that it expected to miss original forecasts for its results in the year to July 31, 2024.
This morning it issued unaudited figures for the period which revealed that group revenues decreased 6.5% to £155.5m (FY23: £166.3m) with supermarket ordering held back by overstocking, weakened consumer demand for general merchandise, and strong prior year comparatives having been bolstered by the exceptionally strong demand for energy-efficient air fryers in the first half of 2023.
In line with market expectations, unaudited adjusted EBITDA decreased by 11% to £18m (FY23: £20.2m) and unaudited adjusted profit before tax decreased by 14% to £14.4m (FY23: £16.8m).
At the year end, the group had a net bank debt of £10.4m, compared with £14.8m in 2023, which represents a net bank debt/adjusted EBITDA ratio of 0.6x (FY23: 0.7x), well within the group’s capital allocation policy of 1.0x.
However, the group – which owns a number of leading homeware brands including Salter, the UK’s oldest houseware brand, est.1760, and Beldray, est.1872 – said trading at the start of the current financial year is in line with market expectations.
The significant increase in shipping rates, arising from disruption in the Red Sea, has seen some recent stabilisation and is leading supply chains to adapt to a new normal.
While this process takes place, the group said its commercial teams are working hard, as they did in the previous shipping crisis, to mitigate the short term impact on gross margin.
Chief executive, Andrew Gossage, said: “Our FY24 performance was not without its challenges but I am pleased to report that many of the temporary headwinds are now easing, as reflected in a healthy FY25 order book.
“As we look ahead to FY25 with cautious optimism, we are confident in the proven resilience of our business model and the ongoing demand for our fantastic range of leading homeware brands.”
The group intends to announce its full year financial results on October 29.
