Naylor increases profits but warns of £5m Covid sales drop

Speaking as the company revealed its latest financial results, chief executive Edward Naylor said: “The pandemic has blown us off-course and we’re expecting a £5m shortfall in 2020-21 sales.

“We saw activity levels nose-dive in April but more recently, sales have recovered to within 5-10 per cent of normal levels.

“We raised £5m of extra finance from HSBC earlier in the year which strengthened our capital base and gives us the firepower to keep expanding the business.”

Nevertheless, the company’s results for the financial year to February 29, 2020 - the period immediately preceding the outbreak of the coronavirus pandemic - were generally positive, revealing a steady improvement in profitability.

Sales, which grew 13 per cent in the previous year, were only fractionally higher at £55.6m (2019: £55.3m) due to challenging market conditions.

However, over recent years, Naylor has invested heavily in its manufacturing operations, with increased efficiencies resulting in a 34 per cent increase in profit before tax to £2.7m (2019: £2.0m).

Naylor is a fourth-generation family business with six manufacturing sites across the UK, including three in the Barnsley area. The company manufactures clay and plastic pipes as well as concrete products and employs nearly 400 people.

Recent years have seen the company invest heavily in plant and premises, acquiring two new freehold sites in Barugh Green and Wombwell and constructing a £5.5m manufacturing plant for large diameter plastic drainage.

In July 2020, the company commissioned a new automated £2m concrete lintel plant at Barugh Green, following this in August 2020 with the acquisition of £3.3m-turnover concrete fence-post manufacturer Procter Fencing, based in Garforth.

Mr Naylor said: “2019-20 was a year of steady progress despite challenging market conditions. Although our key construction markets remained unsettled in the aftermath of the Brexit referendum, we achieved an encouraging increase in profitability, with our factories becoming more efficient thanks to the capital investment of the last few years.”

The company said the early stages of the coronavirus pandemic had been disruptive, with two of its factories closing temporarily, although all its sites continued to service its customers, many of them engaged in key infrastructure and healthcare projects.