23rd Mar 2015 10:11
LONDON (Alliance News) - Pittards PLC Monday reported a slight drop in pretax profit and revenue in 2014 due to the strengthening pound in the first half of the year, but it said its performance had improved in the second half as it predicted.
The leather producer reported a pretax profit of GBP1.6 million for 2014, down from GBP1.6 million in 2013, as revenue declined to GBP34.7 million, from GBP35.8 million. It said sterling strength, principally against the dollar in which a significant proportion of its sales are invoiced, was a major issue for the business until July when it peaked and then rapidly moved back to "more acceptable levels".
Still, its gross margin was broadly flat at 20% as it also benefitted when buying raw materials in dollars and euros. Cost reduction exercises it implemented in the first half also meant that distribution costs were GBP0.3 million lower than in 2013, more than offsetting an additional corporation tax charge of GBP0.2 million related to its Ethiopian tannery business.
Pittards had reported a GBP0.3 million pretax profit for the first half of the year, down from GBP1 million a year earlier, as revenue fell to GBP17.4 million from GBP18.4 million.
"Whilst there are global uncertainties in various areas of the world we have started 2015 with more favourable currency rates and stable raw material prices. Trading is currently in line with our expectations and we have identified a number of opportunities for expansion which we look forward to bringing to fruition," it said Monday.
Still, its shares were down 4.6% at 135.00 pence Monday morning. The stock is still up 18.4% so far in 2015.
By Steve McGrath; [email protected]; @stevemcgrath1
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