An upholstered furniture manufacturer in the UK has reported a significant decline in both sales and profit for the financial year ending 30 September 2024.
According to the company, Buoyant Upholstery, latest accounts, total sales dropped by 18.9% to £41.8m, compared to £51.5m in 2023. Pre-tax profit also fell, reaching £1.4m, down from £2.7m the previous year. UK revenue declined to £38.2m from £46.3m, while its Ireland division experienced a fall in sales to £3.5m from £5.2m.
Despite the drop in revenue, the company improved its gross margin to 27.1%, up from 25.7%, attributed to better control of staffing levels and supplier costs. The company stated that "raw material prices stabilised," supporting more sustainable margins.
Management noted that the decline in turnover was in line with broader market conditions, including reduced consumer spending on large-ticket items and a slowdown in housing transactions throughout the year.
Looking ahead to 2025, Buoyant Upholstery has observed a rebound in demand, supported by the launch of several successful product lines and a recovery in housing activity. The company is currently performing above budget and ahead of its 2023 performance.
However, concerns remain regarding the upcoming increase in the UK's minimum wage and Employer National Insurance contributions in April 2025. As a result, the company has raised its selling prices to offset the additional costs.
The board expressed cautious optimism, stating that while performance is currently strong, they remain "very conscious" of the economic pressures expected in the months ahead.
Source: www.bigfurnituregroup.com