Blue Seal has become the first catering equipment manufacturer to provide a meaningful picture of how it fared in 2019 by filing its latest accounts with Companies House.
Most catering equipment manufacturers in the UK have published their accounts for the year to 31 December 2018, but Blue Seal’s financial report comprises the 12-month period ending 31 August 2019.
2019 was one of the most turbulent yet for the UK catering equipment sector, with uncertainty over Brexit and a string of operator collapses heaping pressure on the supply chain.
Blue Seal said political uncertainty caused the market to slow down, but it continued to maintain sales across all customer types, with its Blue Seal, Turbofan and Waldorf brand all showing “growing acceptance” in the market.
Turnover was virtually identical to the prior year at £17.1m, while operating profit came in at £2.67m versus £2.75m the year before.
Commentary accompanying the accounts stated: “Together with continued market penetration, and overheads and margins being tightly controlled by management, the result has been the overall profitability being maintained compared to the prior year.”
The Birmingham-based outfit, which is part of the Ali Group, implemented a change in accounting principles during 2019, whereby rebates are now being deducted from sales. On an adjusted basis, sales would have increased 1.1%.
With regards to future developments, the report stated: “The director expects the general level of activity to be maintained in the forthcoming year. We expect the market to be difficult due to continued economic uncertainties ranging resulting from Brexit.”
Although the UK is poised to leave the EU on 31 January, manufacturers are waiting to see if any clear trade terms are defined.
Blue Seal said it is likely that this could lead to a period of “considerable uncertainty”, particularly in relation to global financial markets and the supply of capital.
Brexit has already led to significant volatility in currency exchange rates, which has impacted Blue Seal’s pricing decisions. However, the company said the impact on the business was likely to be “minimal” as the majority of its market place is contained within the UK.
More than 97% of its purchases are made in sterling, making it less exposed to foreign exchange risk fluctuation than other brands operating in the sector.