Cheshire firm Brammer sees pre-tax profits slip against rising sales

Industrial maintenance and repair product firm Brammer has seen a drop in its year-on-year pre-tax profits in the six months ending June 30.

The Cheshire company’s H1 2015 results show that its profits before tax fell by 19.4% to £14.1m, from £17.5m at the same point in 2014. Overall sales figures for the six-month period were up, however, by 0.4%, increasing from £364.1m to £365.6m.

Additionally, sales per working day (SPWD) rose by 7.2%. While the figure increased by just 0.9% in the UK, some of Brammer’s European markets experienced significant sales growth. In Germany, for instance, the company saw SPWD rise by 7%, while in France growth was 9% and in its Eastern Europe & Other segment, 28.5%.

The chief executive of the Knutsford-headquartered company, Ian Fraser, said: “For the remainder of the year, we expect to see continued improvement in our UK business, and solid growth in our continental businesses, but our Nordic business will continue to suffer from ongoing market headwinds.

“We have seen evidence of an improving trend in gross margins since the end of the first quarter, and should benefit from the impact of the cost-reduction programme, completed in the first half.”

Ian added: “Whilst mindful of tough market conditions and the impact of continuing weakness in the Euro, we remain on track to meet the Board’s expectations for the full year.”

With its cost-reduction programme, which has incurred an exceptional charge of £3.6m, Brammer is expecting to save £5m in costs by the close of 2015.

Commenting further on the findings, Ian Fraser said: “The UK (including Ireland and Iceland) is our largest operation, contributing 39.3% to total Group revenue. It is the business where the Brammer growth strategy is furthest developed.

“Sales increased by £1.3 million to £143.5 million, representing SPWD growth of 0.9% compared to the 1.4% decline in the equivalent period in 2014.”

He continued: “Organic growth is broadly flat, representing a stabilisation of trading with a small number of large customers and some positive signs of a return to growth.”