Losses reduce by £3.2m at listed Safestyle
Bradford-headquartered Safestyle has reduced its pre-tax losses by £3.2m in a half-year it focused on it continued turnaround.
The retailer and manufacturer of PVCu replacement windows and doors this morning published its results for the six month period ended 30 June 2019. Pre-tax losses reduced by £3.2m (56.1%), from losses of £5.6m to losses of £2.5m.
Revenue increased 6.4%, from £60.5m to £64.4m.
Safestyle, which was last year hampered by profit warnings and drops in market share, today said its turnaround was on track. The listed business added: “The implementation of phase two of the three phase turnaround is making good progress; the focus for phase two is returning the Group to profitability.
“The business returned to profitability in Q2 2019 with levels forecast to increase in H2.”
Of its outlook, Safestyle’s Board is anticipating an increase in the levels of investment required in lead generation versus those previously projected and when compared to those of previous years.
It added: “”The Board also expects revenue to be marginally below previous expectations, although still expects double-digit growth in H2 versus the prior year alongside continued gains in market share.”
The Board now expects a small underlying loss before taxation of £500,000 for the full year.
Safestyle installed 98,966 frames during the period, which it said was broadly in line with H1 2018 of 99,491 and represented a 16.9% improvement on H2 2018.
Safestyle said it had also started to gain market share. The firm added: “Market share as measured by FENSA now recovering; at 8.6% in H1 2019 (H2 2018: 7.0%) with continued share recovery expected for H2.”
Improvements in its operational efficiencies and cost reductions in a number of areas have underpinned the recovery in profitability.
Safestyle added: “Despite a challenging market where consumer demand appears soft across the Repair, Maintenance and Improvement (RMI) market, the Board expects a further increase in profitability during Q3 and into Q4 of this year.
“The Board remains highly focussed on ensuring that the trajectory of performance is carried through into 2020 with the aim to achieve acceleration in growth in revenue and profitability next year as part of phase three of the Group’s turnaround plan.
Mike Gallacher, CEO , added: “We are making strong progress on delivery of the second phase of our three phase turnaround plan. We have increased our revenues, improved our margins and reduced costs and as a result the Group returned to profitability in Q2. We expect this to continue into Q3 and the momentum to be sustained through to the end of the year.
“The Board and I are hugely encouraged by the progress we are making as we look to turnaround the performance of our business and build on our position as the UK market leader in the RMI industry. We believe we have an enviable position in this market with a strong, recognisable brand and a great value proposition. We also have highly skilled and dedicated people across the entire organisation.
“There remains a lot of hard work to do, but it is rewarding that we are beginning to see the results of the work completed so far. We remain wholly focussed on modernising the business, improving customer service, strengthening our processes and leveraging technology whilst striving to make the business the industry benchmark in all areas of compliance. We believe delivery of these objectives, along with a relentless focus on maximising opportunities for growth, will position Safestyle for success in the years to come.”
