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Business News in County Durham

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Homeware manufacturer upbeat despite profit dip

Homeware manufacturer upbeat despite profit dip

A County Durham homeware manufacturer believes it is in a "strong position" from which to grow despite Brexit increasing costs and ultimately impacting its profit performance.

BHK UK is part of the wider BHK Group, which is headquartered in Germany.

Its Peterlee division, which employs a workforce of about 75, was established in 1988 and specialises in manufacturing drawers, flooring and staircases.

For the year to 31 December 2016, BHK reported turnover of £9.82m compared to £9.45m. Of this total, £9.28m came from UK sales with the remaining £540,674 coming from overseas.

Pre-tax profits were down from £1.03m to £70,372.

BHK said 2016 "started well" with the business broadly on budget to the end of June.

However, a large part of the business' raw materials are purchased in euros or are subject to euro movements, so following the Brexit vote these costs "increased significantly".

"Those costs have now been reflected in increased selling prices but during the third and fourth quarters of 2016, profits were considerably reduced while new prices were negotiated and put in place," said BHK.

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