Wax Lyrical and Royal Worcester producer back on track in wake of profit warning

Pottery manufacturer Portmeirion has said it has made headway since its profit warning in May which was caused by short-term challenges in its export markets.

The Wax Lyrical and Royal Worcester producer said “considerable progress” has been made to resolve short term issues in export markets including new product development for Korea resulting in a stronger order book for the key second half trading period.

It said its results for the six months to the end of June are in line with expectations while the group anticipates achieving full year expectations.

The company reported revenue of £34.9m for the period, down 5.4% from £36.9m, while headline profit before tax excluding exceptional items such as acquisition costs came in at £500,000, falling from £2.1m.

It saw revenue growth of 9.2% in the UK, its largest market while the US market performed in line with its plan in the first half with positive signs for full year.

Last month, Portmeirion acquired US based premium homewares business Nambé, for £9.5m, which it says will add scale in a key market.

It said the purchase provides “exciting opportunities” for sales growth and is expected to be earnings enhancing in first full year of ownership.

Dick Steele, non-executive chairman, said: “Due to the seasonality of our business, the first half is always a small part of the overall group performance and is not a reliable indicator of the full year. We were disappointed with our May trading update due to short term challenges in our export markets in the first four months of the year.

“However, we are encouraged by progress made in these markets since May and pleased that other critical parts of the business are performing well and in line with our expectations.

“Early signs for the remainder of the year are positive and we expect to meet full year market expectations. We are also delighted with the Nambé acquisition in July which will enhance our successful US business and deliver further diversification in both geographical markets and products. We have a great track record of consistent top and bottom line growth and we believe our long term strategy is the correct one to continue this trend in the future.”