Upmarket cooker and kitchen accessories firm AGA Rangemaster saw revenues slip slightly in 2012 and warned that a market upturn in the near future in unlikely as it continues to be affected by a subdued housing market.

The company said on Friday morning that it has decided not to pay a final dividend, compared with a 1.9p-a-share total payout in 2011, after coming to an agreement on funding with the trustee of the main pension scheme.

Revenues fell 2.5% from £250.9m to £244.6m last year as the firm saw "little respite to the long-running weakness of the consumer markets in which we operate". The weakening euro also had a negative affect on top-line growth.

On the other hand, the firm said that sales of AGA cookers, tiles from its Fired Earth shops and Marvel refrigerators in North America were showing "encouraging progress". Other investments and collaborations internationally - such as those in China - also provide a good base for "rapid expansion", AGA said.

In spite of falling sales and a flat core market, the company was able to grow its profit before tax from £7.5m to £8.4m over the year, helped by cost and efficiency programmes.

AGA said that sales in core UK markets are linked directly to the housing market and transaction levels are beginning to "edge up", helped by the government's focus on the sector. "However, current trading conditions continue to be flat. This means that our additional focus on strategic positioning in international markets is likely to prove crucial to delivering renewed momentum."

Net cash stood at just £5.5m at the end of 2012, copmared with £31.3m the year before, though this was mainly due to contributions into the pension scheme and scaling down the pension deficit.

Current trading

The company's outlook on Friday was a touch gloomy, as it said that pressures on consumers have reduced the number of house moves and home-improvement initiatives.

"These factors have impacted our operations for some years, and we have to prepare for a continuation of the flat markets we have been seeing."

2013 so far has been characterised as a slow January and positive February, with a notable pick-up against last year seen in AGA Marvel in North America and for Fired Earth.

However, AGA orders are flat and Rangemaster orders have trended down ahead of the sales and marketing initiatives planned for this spring, the company said.



BC

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