Turbulent leather market sees Pittards revenue fall in first half

Specialist advanced leather producer Pittards reported a 16% drop in interim revenue in its half-year report on Thursday, to £12.1m.

The AIM-traded firm said its EBITDA for the six months ended 30 June was in line with the prior year at £0.8m, while its profit before tax increased to £0.2m from £0.1m.

Net assets at period end stood at £18.5m, in line with that it reported at the end of the 2018 financial year, while its gross margin improved to 29.7%, from 25.1% on 31 December.

On the operational front, Pittards said its strategic initiatives were progressing “well”, particularly in the interiors market and in Ethiopian footwear manufacturing.

“The themes outlined in our 2018 annual report have continued into the first half of 2019; we have delivered a solid financial performance against ongoing fluctuations in global trading and made important progress to diversify our business,” said Pittards chairman Stephen Yapp.

“The improvement in profitability reflects the hard work to enhance operational efficiencies, investments to broaden our manufacturing capabilities and our focus on delivering a quality service to core customers, whilst taking further steps to create a more balanced portfolio.”

Yapp said the company was entering the second half of the year with a “good” order book, a lower cost base and improved margins.

“Looking ahead, we are increasingly optimistic about the pipeline of opportunities within our core and targeted markets.

“Whilst this is set against an uncertain economic outlook, we expect the second half to be stronger than the first, particularly in terms of profit and are confident our ongoing investment plans and strategy will deliver significant shareholder value as these fully mature.”