LONDON (Alliance News) - Leather goods maker Pittards PLC Tuesday reported a jump in 2013 pretax profit as it sold a higher proportion of more profitable goods and kept tight control on its costs.
The company reported a pretax profit of GBP1.7 million for 2013, up from GBP0.3 million in 2012, even though revenues declined to GBP35.8 million, from GBP37.0 million.
Pittards blamed the revenue decline on a lower proportion of commodity-style leather goods sold. It was hit by high skin prices in early 2013 and this made it temporarily uncompetitive in these markets. However, that also meant its gross margin rose to 20.4%, from 17.4% in 2012, boosting its profitability, as it sold more profitable products overall.
"The dollar was stronger in the first half of 2013 than it had been in 2012 which was beneficial given our level of dollar denominated export sales, but the decline to nearly $1.65 at the end of the year had an adverse effect on both turnover in the final quarter and the balance sheet, which tempered the overall result somewhat," it cautioned.
Pittards said that industrial and dress glove production increased at its Ethiopia factory and are becoming more significant to its total turnover. The company, which also makes products in the UK, said it intends to add to its retail presence as recognition of its own Pittards and Daines & Hathaway brands continues to grow and the "Made in Britain" movement advances.
Pittards added that dividend payments are now feasible as soon as it deems it is appropriate for the business.
Pittards shares were down 2.5% at 195 pence Tuesday.
By Steve McGrath; stevemcgrath@alliancenews.com; @SteveMcGrath1
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