AGA Rangemaster sees sales slip in tough market

Upmarket cooker and kitchen accessories firm AGA Rangemaster saw revenues slip slightly in 2012 and warned that a market upturn in the near future in unlikely as it continues to be affected by a subdued housing market.

Upmarket cooker and kitchen accessories firm AGA Rangemaster saw revenues slip slightly in 2012 and warned that a market upturn in the near future in unlikely as it continues to be affected by a subdued housing market.

The company said on Friday morning that it has decided not to pay a final dividend, compared with a 1.9p-a-share total payout in 2011, after coming to an agreement on funding with the trustee of the main pension scheme.

Revenues fell 2.5% from £250.9m to £244.6m last year as the firm saw "little respite to the long-running weakness of the consumer markets in which we operate". The weakening euro also had a negative affect on top-line growth.

On the other hand, the firm said that sales of AGA cookers, tiles from its Fired Earth shops and Marvel refrigerators in North America were showing "encouraging progress". Other investments and collaborations internationally - such as those in China - also provide a good base for "rapid expansion", AGA said.

In spite of falling sales and a flat core market, the company was able to grow its profit before tax from £7.5m to £8.4m over the year, helped by cost and efficiency programmes.

AGA said that sales in core UK markets are linked directly to the housing market and transaction levels are beginning to "edge up", helped by the government's focus on the sector. "However, current trading conditions continue to be flat.This means that our additional focus on strategic positioning in international markets is likely to prove crucial to delivering renewed momentum."

Net cash stood at just £5.5m at the end of 2012, copmared with £31.3m the year before, though this was mainly due to contributions into the pension scheme and scaling down the pension deficit.

Current tradingThe company's outlook on Friday was a touch gloomy, as it said that pressures on consumers have reduced the number of house moves and home-improvement initiatives.

"These factors have impacted our operations for some years, and we have to prepare for a continuation of the flat markets we have been seeing."

2013 so far has been characterised as a slow January and positive February, with a notable pick-up against last year seen in AGA Marvel in North America and for Fired Earth.

However, AGA orders are flat and Rangemaster orders have trended down ahead of the sales and marketing initiatives planned for this spring, the company said.

BC

Recommended

Get healthy returns from these three healthcare stocks
Share tips

Get healthy returns from these three healthcare stocks

Professional investor Paul Major of the BB Healthcare Trust highlights three of his favourite healthcare stocks.
25 Oct 2021
Share tips of the week – 22 October
Share tips

Share tips of the week – 22 October

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
22 Oct 2021
Three dividend stocks from the dynamic Asia/Pacific region
Share tips

Three dividend stocks from the dynamic Asia/Pacific region

Professional investor Sat Duhra of the Henderson Far East Income investment trust highlights three of his favourite stocks.
18 Oct 2021
Share tips of the week – 15 October
Share tips

Share tips of the week – 15 October

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
15 Oct 2021

Most Popular

Properties for sale for around £1m
Houses for sale

Properties for sale for around £1m

From a stone-built farmhouse in the Snowdonia National Park, to a Victorian terraced house close to London’s Regent’s Canal, eight of the best propert…
15 Oct 2021
How to invest as we move to a hydrogen economy
Energy

How to invest as we move to a hydrogen economy

The government has started to roll out its plans for switching us over from fossil fuels to hydrogen and renewable energy. Should investors buy in? St…
8 Oct 2021
Emerging markets: the Brics never lived up to their promise – but is now the time to buy?
Emerging markets

Emerging markets: the Brics never lived up to their promise – but is now the time to buy?

Twenty years ago hopes were high for Brazil, Russia, India and China – the “Brics” emerging-market economies. But only China has beaten expectations. …
18 Oct 2021