Stoke-on-Trent-based pottery manufacturer Emma Bridgewater has reported a financial loss of near £1.4 million attributed to soaring production costs.
Latest accounts filed for the firm at Companies House show a pre-tax operating loss of £1,380,691 for the year ended 29 April 2023.
The company has said that “unbudgeted increases” at the factory in Hanley and having to heavily discount goods due to increased competition online had impacted profits, which hit £1.1 million in the previous financial year.
However, sales did increase during the latest accounts period rising nine per cent to £36.2 million compared to £33.1 million in 2022.
A financial report reads: “Web sales increased slightly, consolidating on the significant increase from the previous year.
“In addition to this, the wholesale and retail shops channels showed strong sales growth as they recovered from the pandemic years. Export sales grew significantly with Tmall Global martketplace sales in China leading the way.”
It adds: “Unbudgeted increases in factory raw material costs and energy non-commodity costs led to a higher than planned cost of production in the factory.
“In addition, a competitive eCommerce sales environment during the year meant we discounted further to drive sales, particularly in the Summer Sale. Both of these factors, led to a reduction in EBITDA versus the prior year, despite the strong sales growth.”
Emma Bridgewater, which had 469 employees at the time of the report, cut its workforce by around 40 people last summer as production requirement decreased. The factory also went to a four-day working week for a period of 10 weeks.
A further 36 jobs were removed in February and a further 10-week period of short-time working started.
The accounts state plans to review pottery stock levels against sales forecasts for the next 12 to 15 months.
The report adds: “We plan to actively progress our activities to ensure profitability in all market conditions.
“Given the current economic climate in the UK, US and China, and the complications of trading in Europe following Brexit, our focus is currently on reducing the fixed cost base of the company to allow us to respond more flexibly to changes in trading conditions.”
Emma Bridgewater was founded in 1985 and is one of the largest pottery manufacturers based entirely in the UK.
