Woodchip manufacturer Egger has reported revenues of nearly £400m but warned that it faces challenging times in the coming months.
The Hexham firm has released accounts for the year ending April 2022 which show a 32% increase in turnover to £398.8m. Over the same period, operating profits rose by almost 50% to £51.7m.
The company said it had benefited from the return to people investing in their homes after the Covid pandemic. But it warned that high inflation levels and other pressures in the economy could affect its performance in the coming months.
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Andrew Tait, commercial director for Egger’s Western Europe Division, said: “Market demand was very strong throughout 2021/22, and we saw a continuing trend of end consumers investing in their homes. As a major supplier into the kitchen, bedroom and bathroom sectors, as well as key supplier into the construction industry, we benefited from the strong market conditions and maximised our capacities and product mix to meet customer demand.
“We worked in partnership with our customers to deal with the inflation that has heavily impacted our sector and ensured good customer service throughout the period. We are optimistic for the future, despite the economic conditions.”
Bernd Steinlechner, divisional financial director for the firm, said: “Egger (海角视频) Ltd closed its 2021/2022 financial year in exceptionally challenging times. The ongoing Covid-19 pandemic and the dramatic developments in Ukraine was impacting the global energy and raw materials markets. Product demand was high and this is reflected in the financial figures.
“The increase shows that we have navigated the challenges of the ongoing pandemic and made use of the opportunities that arose in our industry. The crisis in Ukraine, volatile commodity markets, uncertain energy supplies and rising inflation are all factors that dampen the Egger Group’s earnings expectations for the coming financial year. This makes it difficult to forecast the next few months.”
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In the accounts, Egger said that it was subject to risks to the economy that included the war in Ukraine, Brexit and rising energy prices. It also highlighted that competition for its main raw material, wood, was intense, but that it had long-term contracts with suppliers to keeep prices manageable.
Mr Steinlechner said that Egger would continue to invest in its production facilities at Hexham. The company’s headcount rose over the year to 757.
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