SCOT JCB (Holdings), the Glasgow-based plant company, has declared confidence in its growth prospects after challenges arising from Covid-19 caused turnover and profits to tumble in its latest financial year.
The family-owned company, which supplies machinery to the construction, engineering and agriculture sectors, highlighted the effects of lockdown as profits fell by nearly 30 per cent to £2.76 million in the year ended December 31. Turnover dropped by almost one-third to £120.6m.
The downturn in sales, which came after the Scottish construction industry was placed into lockdown last March, led the business to shed 15% of its headcount.
However, a resurgence in demand since coronavirus restrictions eased has resulted in staff numbers recovering, with the company doubling its apprentice intake from its usual nine per year to 18. It now has 36 apprentice engineers on its books, while its overall headcount is back to around 300 – almost in line with the position before coronavirus struck.
Led by brothers and joint managing directors Iain and Robin Bryant, Scot JCB operates from 17 depots across Scotland and the north of England. The company supplies equipment such as diggers, excavators and tractors, in addition to providing parts and servicing.
Speaking to The Herald, Iain Bryant said that the period covered by the latest accounts “was a very tough year”, especially when “all sales in construction stopped” during a two-month lockdown period that began in March of last year.
But he said the company’s Scot Agri division performed consistently well, with the sector continuing its role as an “essential” service in keeping the nation supplied amid the pandemic.
Iain Bryant said: “In agriculture the cows still need milked, whether it is Covid or not, so the machines had to keep running.
“Considering where we were in March, when the first lockdown came into place and construction in Scotland was forced to stop completely, to finish the year where we did, we were pretty pleased. It was a very hard year. To end up with the turnover we have got and the profit we have got, I think the business did really well.”
He added: “There was a bit of a bounce back in the last three months of the year, which helped as construction finally got going.”
The Bryant brothers said demand from the housebuilding, civil engineering and agriculture sectors is currently strong, and expect the trend to continue, although they remain “vigilant” over the potential impact of rising coronavirus infection rates.
But they said the company is not immune from well-documented disruption to the supply chain, which is currently causing a shortage of products and materials across a raft of industries.
In the case of Scot JCB, the main impact is the lead time in receiving machinery ordered from JCB because the plant equipment giant is dealing with shortages of key components.
Robin Bryant said: “They (JCB) are struggling with their supply chain to try and get the components they need to build machines.
“Although they have done an amazing job, and it has not been as bad as some of the horror stories you hear in other industries… it has definitely hurt them. We could have sold a lot more product, but we haven’t been able to get the supply.”
Iain Bryant added: “There has been a big increase in demand. We just haven’t had our usual stock levels because of component shortages. That has really hampered us this year. The demand is strong, be it for construction or agriculture goods.”
Comment on the outlook, Iain Bryant said it is “positive and it is going to continue”, highlighting strong demand from the housebuilding, civil engineering and agriculture sectors.
The company said it is confident of meeting its targets for turnover and profit for the current year, during which it hopes to return to pre-pandemic levels. Much of the machinery it now provides is electrical.