Spike in profits for Co Tyrone door manufacturer following acquisition
A Co Tyrone kitchen and bedroom door manufacturer has reported a 35% rise in pre-tax profits to £5.7m after it was acquired by a Dutch investment company.
Established in 1990 by twin brothers Brian and Kieran McCracken, Cookstown-based BA Kitchen Components is now one of the UK's leading manufacturers of kitchen and bedroom doors and furniture components.
It also operates manufacturing sites in Doncaster and Rotherham.
Based in Amsterdam and London, H2 Equity Partners acquired a 53.41% majority stake in BA Kitchen Components in August 2017. The McCracken brothers remain significant shareholders in the firm.
Despite a 5% decline in revenue to £27.8m for the 12 months to March 31, 2018, BA Kitchen Components reported a £1.5m rise in pre-tax profits.
The increase is largely due to an exceptional profit derived from the transfer of two properties during the year to the firm's shareholders. The properties, valued at £8.5m, had a net book value of £6.1m. The transaction left a £2.4m gain on the balance sheets for the year.
Despite the dip in revenue, the company's directors said in their annual statement that they remain committed to increasing the firm's market share in the UK, Irish and global markets.
"Further successful implementation of this growth strategy combined with achievement of improvements in buying, inventory management and overhead cost savings has resulted in the satisfactory results reported for 2018, despite the sector remaining competitive and the uncertain economic environment." The report also revealed that BA Kitchen Components Ltd cut its staff from 242 to 230 over the year. H2 Equity Partner's August 2017 acquisition included BA Clic Components site in Rotherham, which has been the base for the firm's tool-less assembly ClicBox kitchen and furniture cabinets since 2016.
The new company report for BA Kitchen Components shows that H2's majority shareholding is registered under the firm H2 Portes Topco Ltd.
Incorporated on August 4, 2017, the company recorded a turnover of £16.8m in the period to March 31, 2018, however it posted a pre-tax loss of £354,169.
In its strategic report released in the past fortnight, H2 Portes Topco said it has felt the impact of Brexit: "In line with many businesses, the group has been impacted by the uncertainty surrounding Brexit, particularly through volatility in foreign exchange rates. The precise nature of the future Brexit impact remains unclear. The directors are keeping the position under close review and developing options to address both the potential positive and negative implications."