British sales help JCB counter 'challenges'

JCB said 2013 was its third most profitable year on record, despite turbulence, particularly in emerging economies. The manufacturer, owned and chaired by Lord Bamford, reported annual revenues of £2.68bn, against £2.7bn in 2012. The company, which does not disclose profit figures, said earnings dropped from £365m in 2012 to £313m last year.

Lord Bamford said: “Turnover remained virtually unchanged year-on-year, but volume and earnings were adversely affected by a slowdown in emerging markets, notably India, where JCB has a strong presence. This was further compounded by adverse currency movements in some economies. Turnover growth in the UK, Middle East and Africa during 2013 helped to offset reductions in India, Europe and the Far East.”

Graeme Macdonald, chief executive, said: “Last year was a challenging global environment. Brazil, Russia and particularly India had driven our growth in the past three years, but softened off considerably last year. The flip side was that we saw significant growth in the UK, America, France and Germany.”

He added: “In the UK all the economic indicators have been good and all our customers are reporting higher confidence. We’ve seen this across construction, from hiring to the digger rental market, it’s all very strong.”

Mr Macdonald, who was appointed chief executive last year, disagreed with the view that there was a bubble in the UK construction market. “I don’t think there’s a bubble that’s going to pop at any time soon. Remember we’re coming from a low base after the slowdown. But the confidence is definitely there.”

On the outlook for this year, Lord Bamford, who was recently ennobled for services to manufacturing, said: “2014 has got off to a mixed start. Some markets are showing improvement, with stronger demand in the more developed markets of the UK and North America, which is offsetting weaker demand in the more fragile economies of Asia, Latin America and Russia. Political uncertainty created by elections in India and Brazil is also having an impact on markets.”

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