Pittards better placed for rigours of 2005

Despite growing exports, leading leather company Pittard experienced little recovery in the second half of 2004. In their annual results, out March 18, the company say the benefits from transferring to AIM plus the benefits from ongoing cost savings and efficiency improvements have been offset by a general lack of recovery in the international market for leather and the continuing weakness of the US dollar. The company have announced an operating loss of £2.5 million, up from £1.5 million the previous year. Pre-tax losses for the year as a whole are £5.5 million after £2.5 million of exceptional costs, mainly related to non-recurring costs from the closure of the company's raw materials division in Scotland. Turnover was down to £73.2 million from £85.4 million the previous year and the directors are recommending that no final ordinary dividend be paid. Managing director Stephen Boyd said: 'More than three quarters of our glove leather division's sales are denominated in US dollars and the sterling value of turnover in the year fell by 13%. However, strong growth was achieved in sales to the military and service sectors, based on the introduction of our technically advanced Custom Image Generation leathers, and also to the golf market based on new product introductions with Titleist FootJoy. Sales to the sports footwear and leathergoods sectors have held up well.' Pittards have vigorously addressed their cost base and introduced a number of far-reaching efficiency improvements. Investment in an integrated IT infrastructure has enhanced the effective allocation of resources and the transfer to AIM has helped ensure substantial savings in central overheads. The company are now entering 2005 with a cost base far more in line with the current market and the strong growth in the development of innovative leathers plus the continuing strength of their export market means the company are better placed to make progress in the coming months.