'Significant' price rises squeeze margins at Barrett Steel

In its latest accounts, recently filed at Companies House, Barrett Steel said the group experienced ‘significant’ steel price increases and volatility in demand during the year due to the Russia Ukraine conflict, supply disruption, energy prices and inflation.

Stocks rose from £92.2m to £117.1m due to increased input prices.

A sixth generation family-owned business, Barrett Steel has been a steel stockholder and processor for over 150 years. It has more than 30 sites nationwide.

Net cash flow at the end of the year was £1.3m, compared to £9.2m net debt in 2021, which Barrett said was achieved through increased operating cash flow and strong cash collection.

The group has a new 200,000 sq ft warehouse at Groveport in North Lincolnshire – the the first of its kind in the UK using low embodied carbon steel, which has saved approximately 1,400 tonnes of CO2, it said.

Meanwhile, it acquired the leasehold site for its depot near Edinburgh for £6.2m as well as another leasehold site in Scunthorpe for £6.7m. Other group capital expenditure in the financial year totalled £11.4m.

Barrett paid £1.2m in restructuring costs, which primarily related to the set-up costs of new trading depots as well as some redundancies. The group ended the year with 1,189 employees, up from 1,090 in 2021.

In his report accompanying the accounts, chairman James Barrett, said: “The group is committed to reducing its carbon footprint. Following the publication of a net zero roadmap, the group is assessing its current emission levels, developing monitoring mechanisms and carbon reduction strategies.”