The Tandem Group’s final results for 2017 report a significant leap in profitability for the Dawes parent, which recorded net profits rising like-for like from £777,000 in 2016 to £1,744,000 in 2017.
Having dodged the fallout of Toys R Us collapsing by settling its business with the toys giant ahead of the UK arm’s closure, the group’s heavy restructuring of its bicycle operations, including the merging of brands, has seen the group issue a cautiously optimistic outlook for the year ahead.
Having streamlined the portfolio and stock holding in a bid to drill down to the profitable lines for Tandem and its partners, the firm is soon to relaunch Dawes and Claud Butler, according to the statement.
A value for money British Eagle offering, paired with the success of the children’s brand Squish, are hoped to continue to prove useful to independent bike shop partners “despite a difficult backdrop in the UK,” says the statement on the next 12 months.
Restructuring remains ongoing, according to group chairman Mervyn Keene who said in the statement: “During the course of the year we expect to develop our direct to consumer websites further and recruit in the areas of product development and marketing in order to bring more new and innovative products to market. Our use of automated technology in our operations, logistics and distribution will continue to be streamlined to enable an ever more efficient process from customer order to dispatch and delivery.”
Total revenues actually decreased by 4% accounting for the bicycle division restructuring during 2017, falling to £36,837,000. Operating profits before costs and taxation rose to £2,401,000 compared to £1,379,000 the year prior, while gross profits increased 9% to £10,887,000.
Among other factors enhancing the business’ profitability, renegotiation of supplier contracts, discontinuing underperforming lines and introducing new lines contributed to the positive results.