Wooltex U.K. Limited

The principal activity of the group continued to be the design, manufacture and sale of fabrics for the contract upholstery market. Results, Performance and Developments during the year I am pleased to report another profitable year for the group during 2023 despite experiencing significant headwinds. Sales have been impacted by challenging market conditions due to lower general economic activity. Sales during the year were lower by 15.8% when compared to 2022. Action has been taken to reduce the group's cost base and bring our internal production levels into line with current sales. Nevertheless, we are well placed to take advantage of an upturn in future sales. Our new spinning company was profitable during its first full year of operation, and we anticipate future growth in profit as our general sales recover. Despite the difficult sales environment the group has continued to be debt free. We continue to monitor the effects of our business on the environment and instigate change where necessary. The directors would like to thank all employees and suppliers for their hard work and support during the year. Principal risks and uncertainties The Directors consider that the key risks and principal uncertainties faced by the company are: Raw material price volatility Exchange rate variances Supply chain disruption These risks are managed through monitoring of the appropriate markets, the use of forward contracts and currency hedges, maintaining close supplier relationships and dual sourcing of key resources. Financial Instruments Due to the nature of the financial instruments used by the company there is no material exposure to price risk. The company's approach to managing other risk applicable to the financial instruments concerned are shown below. In respect of bank balances the liquidity risk is managed by maintaining a balance between the continuity of funding and flexibility through the use of short term funding. Trade debtors are managed in respect of credit and cash flow by policies concerning the credit offered to customers and the regular monitoring of amounts outstanding for both time and credit limits. Trade creditors liquidity risk is managed by ensuring sufficient funds are available to meet amounts due. Key Performance indicators Key performance indicators monitored by management include order in-take, gross margin, stock volumes and cash collection. Outlook The directors continue to examine opportunities for further development of the business and its efficiencies. The directors have considered the results of the current financial year up to the date of this report, and despite the difficult market conditions expect to further enhance shareholder value in 2024.