A focus on replacing low margin business with new opportunities more likely to yield better returns led to an improvement in gross margin for Winterhalter during 2018, while turnover shot up by 12% to £32.1m, an increase of £3m.
That’s not to say conditions have been easy, with directors of the Milton Keynes-based citing the “highly competitive” nature of the warewashing equipment market and the “constant downward pressure” on margins.
A significant chunk of commentary contained in its latest financial report references contingency planning for Brexit, with the German-owned firm spelling out what the ‘worst case’ scenario of a ‘no deal’ Brexit would mean for the business.
With the prospect of custom delays and transport disruption between the UK and the EU likely to extend for a “lengthy period of time” in such circumstances, Winterhalter said it had planned for a limited increase in machine stocks but noted that the extent of its current range and the differing needs of customers precluded it from holding every machine variant possible.
To counter potential machine supply problems it has significantly increased its stockholding of parts, however, with the view that where machines cannot be replaced immediately it will at least be in a position to support customers by maintaining machines in working order.
An operating loss of £674,000 in 2018 was triggered by a mixture of higher administrative expenses and fair value movements, but its income statement shows it ended the period with a net profit of £3.1m after receiving income from fixed assets investments of £3.7m.
Turnover: £32.14m (+12%)
Operating profit: £674,648 loss (versus a £897,810 loss the year before)
Employees: 162 (138)
Directors that served during the year: J Winterhalter, D Smithson, Dr V Faller, A Blake, D Parsons, P Huber, S Kinkead, R Winterhalter, K Mackay (resigned 08/18), A Salter (resigned 12/18), P Alsworth, K Lynch, G Roberts (appointed 09/18)
Ownership: The ultimate parent company is Karl Winterhalter GmbH & Co. KG, incorporated in Germany.
Financial year end: 31 December 2018