Leeds Group improves sales, earnings, despite German Covid restrictions
Deeper Covid-related restrictions in Europe made it a tough first half trading period for Leeds Group. However, the UK-based fabrics and haberdashery specialist still managed to increase revenues and return to pre-tax profit for its first six months ended 30 November.
Revenues rose to £19.9 million from £18.6 million a year ago. Sales for its German subsidiaries Hemmers and KMR in the first six months were also “higher than expected” with sales at Hemmers increasing to £15.6 million from £14.5 million a year ago and KMR sales inching up to £4.3 million from £4 million 12 months ago.
But chairman Jan Holmstrom warned increased restrictions to control the pandemic in Germany will continue to affect the Hemmers and KMR units until at least until the end of January. It noted that KMR stores have remained closed from 16 December, although operations were supported by it continuing to trade online.
Meanwhile, the overall business also reported a pre-tax profit of £735,000, compared to an £880,000 loss in 2019. Post-tax profit from continuing operations rose to £735,000, compared to a loss of £712,000 a year ago.
It said the effect of prior-year cost-cutting measures "is now evident" and management is “focused on aligning the business with sales demand and competing in markets where it can make acceptable margins”.
Holmstrom said in a statement: “Hemmers and KMR management will work hard to manage the situation and reduce all costs as far as possible given the reduced level of trading and both companies should benefit from any government financial support provided”.
Separately, the Bradford, Yorkshire-based group said the UK’s departure from the the EU will have little impact on the overall business. It noted it trades entirely through its German incorporated firms, and their exports to the UK account for just 3% of group revenue.
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