Ulster Carpets reaches record £64m sales
Ulster Carpets, one of Northern Ireland's best-known manufacturers, has announced "record" sales in the last year while warning of some uncertainty due to Brexit.
Turnover was up 6% to £64m at parent company Ulster Carpet Mills (Holdings) in the year to March 31, 2016 - partly as recovery in the housing market led to a pick-up in demand for its Axminster carpets. But a change in accountancy rules contributed to a fall in pre-tax profits to £6.6m in the year to March 2016 - down 20% from £8.3m a year earlier.
The Craigavon company, which recently received a visit from the Duke and Duchess of Cornwall, sends its luxury products to customers ranging from US casinos to Middle Eastern luxury hotels.
And customers included Buckingham Palace, which ordered 415 square metres of highest-quality covering for the Ball Supper room.
However, the company said there had been signs of "a slowdown or hesitation" in key business areas in the present financial year. However, finance director David Acheson said that the vote to leave the EU had so far had no direct impact on customers' appetite for its products.
The previous year had brought a “record” performance, according to a statement accompanying the accounts by chairman Edward Wilson — the uncle of chief executive Nick Coburn.
Employment was also up from 532 to 564 — and its cash in the bank and at hand was £19.3m, up from £18.2m.
Mr Wilson said its plants had been running at full capacity, and sales had grown in most areas during the year.
And he remarked that the sales increase was made more remarkable by lower prices from competitors, which Mr Wilson claimed did not reflect the real costs involved.
But trading was difficult in eurozone countries.
“Trading conditions with the euro bloc countries continue to be difficult, reflecting their failure to achieve significant growth in GDP.”
However, he said that fluctuations in the pound sterling/US dollar exchange rate had worked in the company’s favour.
And on markets closer to home, he said: “The demand for our Axminster products for the residential market, which has declined markedly in recent times, this year showed a significant increase.”
The present financial year had brought some slowdown so far, but he added that the firm “expect trade to improve over the latter part of the year as there is a good pipeline of prospective orders”.
He added: “The UK economy appears to be continuing to improve although, at the time of writing this report, there is a degree of uncertainty resulting from the June 23 referendum.”
Finance director, David Acheson, said the fall in profits was mainly due to the company adopting accountancy standard FRS 102, which requires firms to restate foreign currency contracts from an earlier financial year at the rate in the present tax year.
And he said Brexit had not had an impact on the firm. “In terms of the uncertainty, we have not seen a huge impact on our business.
“As an exporter, we’re finding that people in those countries are still buying our products and we are cushioned from a lot of the impact.
“We’re not seeing any discernible impact at this stage on our order book.
“But the future depends on how the government goes from here and how they manage things.”
Asked whether the company was in favour of the UK staying in the single market, he said: “We’re in favour of making our products as easy to export as possible.”
Economist John Simpson said the fall in pre-tax profits was mainly due to the change in the accounting standards imposed on the company. “In all other respects, this has been an extremely good year for the company.”
Since the year end covered in the results, the firm has appointed four new directors, Lydia Inglis, Jeremy Wilson, Caroline Somerville and Mr Acheson.
Mr Acheson said he was the only director of the four not to be linked to the Wilson family. The company recently bought interiors company, Roger Oates Design, in England.