James Latham reports exceptional annual financial results1 July 2022
UK leading timber products distributor James Latham plc recorded a 54% growth in sales to £385.4m in the financial year ended March 31, 2022, according to its newly announced annual results.
The company also saw a big improvement in profits – posting a threefold growth in pre-tax profits to £58m (2021: £18.6m).
The company said its strong performance was despite multiple challenges, including pressure on global supply chains and price inflation. The cost price of the company’s products is on average 36.2% higher (2021: 7.6% higher) than at the start of the financial year.
“The strong results seen in this financial year have continued into the new financial year, with volumes and margins comparable to those achieved in the second half of 2021/22,” said James Latham chairman Nick Latham.
“The supply of many of our key products has become a little easier but there are still a few notable challenges, including obtaining alternative supplies to replace products that previously were sourced from Russia.
“We are starting to see signs that cost prices are weakening in some of our major product groups, but the continuing supply chain issues and supplier cost pressures on raw material, logistics, power and other overheads, are tempering these price weaknesses.”
James Latham is continuing to extend its shift systems to improve service levels, with six of its depots now working 24 hours a day.
As at March 31, 2022 net assets have increased to £164m (2021: £118m). Inventory levels have increased to £74.2m from £48.2m last year. This is partly to do with increased inventory in the company’s new business, IJK Timber, based in Northern Ireland, but mainly due to increases in prices for products and extended lead times for imported products.
“Despite the positive start to the year there is increasing uncertainty surrounding the macroeconomic outlook and continuing inflationary pressures on our overheads,” added Nick Latham.
“At this stage the majority of our customers remain busy. We are confident in our ability to deal with the challenges as they arise, but we do not expect to repeat the exceptional results achieved in this financial year.”
The company will continue to invest in its current warehouse facilities, including extending the Yate warehouse to increase capacity and further extending the working day at Scotland, Gateshead and Purfleet. It will also complete phase two of the investment in new machinery at Dresser Mouldings to have a state of the art production facility to improve efficiencies and enable us to target more business.
In the summer the group head office team will relocate to a new modern office in Hemel Hempstead,“We will continue to look for acquisitions that either help with our strategy of developing sales in specific market sectors or any geographical opportunities that arise.”