Blue Seal has become the first major UK catering equipment supplier to publish an annual report incorporating the first coronavirus lockdown period.
The annual report, publicly available on Companies House, covers the 12 months to 31 August 2020.
Due to both the Covid impact and Brexit uncertainty, the cooking equipment manufacturer’s turnover slipped by 23% to £13.1m from 2019’s £17.1m. Operating profit was cut by an even larger figure of 39%, from £2.7m in 2019 to £1.6m in 2020.
Group MD Gregory O’Connell analysed: “The uncertainty of economic conditions caused by the Covid-19 pandemic and the political uncertainty caused by Brexit have both in turn slowed the marketplace. The Covid-19 pandemic has had the dominant effect, through which Blue Seal has continued to maintain sales, across all customer types, with the Blue Seal, Turbofan and Waldorf brands all showing continued acceptance in the marketplace.”
The report detailed that Blue Seal’s revenue declined significantly in the months of April through August compared to the same time last year, as a result of the Covid-19 impact. The company received government wage subsidy during this period which has been used to support its employees to ensure they continued to receive an income, even if they were unable to work their normal hours.
On how the cooking equipment manufacturer further mitigated these effects, O’Connell revealed: “With an industry-wide slowing in the marketplace, overheads and margins have been tightly controlled by management, the result being the loss in profitability was minimised due to the reduced sales.”
Nevertheless, he reassured that the financial position of the company is strong, detailing that he 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 resulting from Brexit and Covid-19.”
O’Connell looked ahead, writing: “The company has a strong and healthy cash flow and in addition to which we budgeted an operating profit for FY21, which enhances the company’s ability to meet all operational funding for FY21.
“It is anticipated that Blue Seal sales will be approximately 4% down against plan for November 2020, but management believe sales will be slightly above plan for the balance of the year, subject to no further issues such as lockdowns.”