AGA Rangemaster stays ahead but plans “major action” on underperforming brands

LEAMINGTON Spa cooker and boiler manufacturer AGA Rangemaster expects to be in profit when it announces its results despite what it refers to as the “continuing headwinds of weak consumer demand in the home move and improvements markets”. 

But the firm says it plans to take major action to improve its position at Waterford Stanley in Ireland and at its French subsidiary Grange.

The specialist in range cookers and kitchen living issued a trading update this morning ahead of its preliminary announcement of the results for the year ended 31st December 2012.

“We expect profit before non-recurring costs, finance costs and tax again to be ahead in spite of the continuing headwinds of weak consumer demand in the home move and improvements markets which left cooker revenues slightly lower,” it said.

“Fired Earth and AGA Marvel both finished the year well. Overall revenues were down 2% as they were at the half year primarily because of declines in Ireland and currency movements.”

The firm says 2013 will see continued cost reduction measures in response to demand levels and major steps to improve its position at Waterford Stanley in Ireland and at Grange, which had a weak end to the year in North America.

“Providing the group with a firm financial foundation for the medium term was an important accomplishment in the year. The new arrangements with the group’s pension scheme and agreement on new banking lines finalised in late November – both running through to the end of 2015 – mean that the work to position the group to achieve growth, irrespective of tough domestic markets, can come through.”

AGA had a net cash balance of more than £5m at the end of the year despite the one off deficit payment and contribution payments into the pension scheme totalling around £20m, as well as payments totalling more than £5m made in respect of the German minority litigation case dating from the 1990s.

The firm’s chief executive William McGrath said: “Our great brands, tight cost control, product innovations and international market development programmes continue to sustain us against the headwind of weak housing transaction levels – for which prospects are now somewhat better.

“We will be investing in our key brands to make sure 2013 is a more progressive year for the group.”