Revenue up at pottery maker as UK market strengthens
Stoke on Trent pottery manufacturer Portmeirion enjoyed a strong first half thanks to a 29% increase in UK sales.
The home market is now the largest for the group after its USA and South Korean sales stuttered during the beginning of the year.
In the six months to June 30, revenue grew 16% to £33.1m (H1 2016: £28.5m). Sales from its Wax Lyrical acquisition were £5.4m (2016: £1.5m in the two months of ownership). Excluding sales from Wax Lyrical, sales for the core Portmeirion business were £27.7m (2016: £27m), an increase of 3%.
Stripping out the Wax Lyrical contribution then half year revenue at a constant exchange rate would have been 2% below prior year.
“The UK became our largest geographical market in 2017 as the majority of Wax Lyrical’s sales are currently in this market. Overall sales in the UK grew by 29% over 2016 because of the additional four months revenue from Wax Lyrical. Excluding Wax Lyrical this market was marginally down on prior year due to the phasing of orders but we expect it to be up for the full year,” it said.
“We continue to monitor the impact of Brexit and potential economic uncertainty. Our emphasis in this market is on seeking new opportunities in own retail and e-commerce, new product development and new trade customers.”
It said the US – its second largest market – remained challenging with sales down by 25% in local currency and by 15% when translated into sterling. The impact of some 2016 orders not repeating and some one-off customer specific challenges were the main factors in this decrease.
Nevertheless, it said it remained confident of growth in the second half and expected strong orders for Christmas Tree and the new home fragrance ranges.
Its third largest market, South Korea, remains under focus. The first half was down on the same period last year. However, it said it anticipated strong demand in the second half of the year.
“We have had a strong first half and have been able to diversify our group sales to the rest of the world, with revenue more than double the same period in 2016. We have seen strong growth in Europe and the Far East, which is very pleasing given our aim of reducing the reliance on our three key markets and diversifying our range of distribution channels and products,” it said.
Pre-tax profit increased by 18% to £1.61m (H1 2016: £1,36m), with EBITDA up 27% to £2.69m (H1 2016: £2.11m).
Dick Steele, non-executive chairman, said: “We are pleased to announce a positive trading performance for the first six months of 2017. We remain confident in our ability to create shareholder value in the short, medium and long term.”