Whitemeadow Furniture Limited

The directors present the strategic report for the year ended 31 December 2023. Fair review of the business Turnover for the year was £54.5m compared to £58.1m in 2023, with a pre-tax profit for the year of £2.9m, our gross margin has increased by 1.7% year on year, this has been primarily achieved through cost efficiencies and the reduction of labour both UK and overseas based contractor costs. Turnover has reduced by 6.5%, overall market conditions have been very challenging with tightening of the customer base, with increased imports from certain market areas, combined with pressure on consumer incomes driving reduced spending in the furniture sector. Raw Material price stabilisation and improved availability have helped realise the benefits of the efficiency programmes, where in the past few years this has been in constant decline, the removal of labour costs has also been very significant. The reduced global economic activity has brought about significant restructuring requirements across the business as it contends higher interest rates, higher labour costs and the higher Selling prices, there has been an industry decline in overall production volumes. Principle risks and uncertainties The shareholders of the business are heavily involved in the day-to-day management of the group of companies and hold regular meetings to review the performance of the group. They analyse the potential risks and opportunities and put into place appropriate plans to mitigate risks and promote opportunities. Cash and Debtors are constantly monitored to optimise the business cash flow. Principle risks and uncertainties include: - UK economic and political climate, increasing taxation, increased employment cost and uncertainty of consumer behaviour.. - Overseas imports have been increasing putting pressure on UK production volumes and customers margins. - Labour and production efficiency can only support these once and rising operational costs will impact. The business is constantly looking at its production operations and supply chain to mitigate these risks, through improved efficiencies and better supply chain management, diversification opportunities to support our own supply requirements, our employees and strong treasury management to ensure we minimise any exchange rate risks. Key Performance Indicators Level of orders- we continually monitor the level of orders into and out of the business. This is categorised by customer accounts and product ranges and gives us a direct opportunity to enhance ongoing relationships whilst exploring opportunities with new customers. This achieved a growth in turnover whilst developing our overall customer base. Raw material and Gross Margin- tracking of these are key to the long-term success of the business. Along with the customer base, our material requirement is a key aspect of our product. Energy- we have seen major changes in the pricing structure of UK energy supplies in the last 12 months, not only does this impact direct energy costs it impacts on all other purchased items inflating at levels not seen for many years, but we are also reviewing our energy efficiency Labour- is a key resource to our future, and as such we are investing in this area continually through training and employee welfare. We work with our key customers and legislation changes to ensure we meet and stay ahead of their requirements and are proud to employ a wide range of nationalities. Transport costs- these are key drivers within the business and have significant impacts on operational efficiencies, the underlying cost structure, and the environment whilst providing our customer base with a quality service. We are constantly therefore challenging this area to develop and improve our service. Other Key Performance Indicators As a property owner key occupancy rates on our premises is also key, and offers a challenge in its own right, finding suitable tenants to cohabit larger production facilities is key.