Headlam hopes for £100m boost to sales
Leading UK flooring distributor Headlam expects to boost its business by £100m in a new drive for sales to larger retail groups, housebuilders and builders merchants.
The announcement came in the plc's annual results for the year ended December 31 which showed the group's net profits were up 38% to £33.6m on sales which were maintained at £663m compared to 2021.
Commenting on the results, chief exective Chris Payne said: "Despite very challenging industry headwinds in the year, most notably the UK cost of living crisis and significant operational cost inflation, revenue was maintained and profit improved against 2021. So far in 2023, revenue performance is slightly ahead of last year despite a continuing weak residential sector."
He added that the UK cost-of-living crisis had "particularly impacted consumer spending on discretionary items. As a consequence, the residential sector of the marketplace, which accounts for approximately two-thirds of the Company's revenue, was notably weak in the year with underlying volumes significantly down. However, product price increases provided support to the Company's revenue performance, as did a recovery in the commercial sector."
Building business with bigger customers
Looking ahead, Headlam says it will be "targeting the multiple retailer and other larger customer segments where the Company is significantly underweight to materially grow revenue."
It has cited success already with growing business with 170-store Tapi, Homebase builder merchants and a major housebuilder. By continuing the focus in this sector, the group says it will add £100m to its sales withing five years.
Accelerating roll-out of trade counters
Headlam's development of a national network of one-stop shop trade counters is also adding to the bottom line and is set to grow. The Company has a target of 90 new, relocated or refitted outlets by the end of 2025, from the 53 sites in 2021. "This fast growing business unit is targeted to add approximately £120 million of revenue upon maturity to the approximate £80 million reported for 2021," says the company's statement.
