Telford-based Aga sees sales fall but profitability improves
Aga Rangemaster managed to narrow its losses last year – but saw sales fall and staff numbers cut.
The historic Telford oven manufacturer's turnover dropped by 5.4 per cent to £142 million in 2016, newly-published accounts filed at Companies House have shown.
However, the company said new products introduced in recent years are beginning to make inroads into the market, while the takeover of the company by American giant Middleby Corp in 2015 is also now seeing overseas sales increase.
Aga also managed to improve its profitability as it improved margins and cut lower-margin parts of the business. EBITDA doubled from £7.2 million to £14.5 million, while bottom-line losses reduced from £20.3 million to £8.1 million.
Aga, which is preparing for the closure of its foundry at Coalbrookdale in the Ironbridge Gorge, cut staff numbers over the course of the year, with its number of employees dropping from 1,528 in 2015 to 1,270 in 2016.
In a statement accompanying the accounts Aga said: "Turnover reduced by 5.4 per cent as Aga cookers and Rangemaster cooker sales slowed in the year, the Divertimenti business was sold in the year and the sales mix was streamlined."
It added: "Product development programmes of recent years are now providing traction in existing and new markets, in particular Europe and the US, in line with our KPI to increase sales internationally.
"We expect Rangemaster to expand further on the continent – a key strategic objective for the company.
"We expect real positive overseas growth in 2017 following on from 10.2 per cent growth experienced in the North and South America segment in 2016."
Middleby took over Aga Rangemaster in September 2015 and in December of that year announced 70 job losses from across its sites in Ketley and Coalbrookdale.
That was followed by another 63 job losses last November, and the company is currently preparing for the closure of its historic foundry at Coalbrookdale in November, which will affect 35 workers – although it is not yet known how many of those jobs will be lost and how many will transfer to the assembly plant at Ketley.
Since the year end sales have continued to fall, while profitability improves.
Sales at the residential kitchen equipment group within Middleby fell by $22.8 million (£17.5 million) or 13 per cent to $153.2 million (£117.9 million) in the second quarter, figures filed in the US showed in August, but the company said the division was more profitable because of “the favourable impact of restructuring initiatives” at Aga.
