OPTICAL Express Group, the eyecare company owned by entrepreneur David Moulsdale, has reported an upsurge in profits in a year that saw it forced to close its business for long periods because of the pandemic.
New accounts for Lorena Investments Limited and Subsidiaries, parent company of Optical Express, show that the optician and laser eye surgery specialist made a profit before tax of more than £20 million in the year ended December 26, 2020.
The result marked a significant uptick on the company’s accounts for 2019, which saw the Cumbernauld-based group make a profit of £648,000. Those accounts contained £4m of exceptional costs, including an undisclosed amount relating to “losses from the write-off of closed store assets.”
The company has trimmed its property portfolio to 105 from 121 and declared yesterday its intention to decrease its exposure to the high street while investing in new clinics. It cited “markedly reduced footfall on the high street” and “consumer preference for a clinic surrounding”.
The company said the process of replacing optical retail practice locations and adding more clinics combined last year with lower marketing costs to significantly reduce overhead.
The accounts for 2020 show the company slashed administrative expenses to £70.5m from £97.4m the prior year.
No dividends were paid to directors for the 2020 financial year.
Director Stewart Mein said: “Our business continued to move from the high street, as leases concluded, to purpose built state-of-the-art clinical facilities driven by consumer demand.
“In turn, property overhead costs were driven down, whilst [the company is] continuing to invest heavily in technological solutions which provide further enhanced levels of clinical outcomes, patient satisfaction and safety.
“As a business, during 2020, we are proud to have continued to offer NHS and emergency service workers, who have done such an amazing job during this awful crisis, free laser eye surgery with over £1m of treatments delivered as part of our Thanks a Million campaign.”
Profits grew last year at Optical, which operates across the UK, Ireland and mainland Europe, in spite of turnover dipping by around £18m to £99m. The fall in turnover was attributed to the business having to close for several months due to the pandemic.
Optical Express Group employed an average of 979 people during its 2020 financial year, down from 1,176 the year before. Payroll costs were reduced to £33.3m from nearly £42m.
Emoluments for the highest-paid director were unchanged at £501,000.
Mr Mein added: “With regard to the future, we are cautiously optimistic on current trading.
“We are confident that we will continue to grow EBITDA (earnings before interest, tax, depreciation and amortisation) over the coming years, although this will be subject to Covid-19 restrictions.
“To that end we have decided, despite our significant growth in profitability, not to award any dividends as a prudent measure. This will allow us to continue to invest in the business and our most important asset, our employees.”
The directors highlight in the accounts the risk of economic conditions remaining challenging as the pandemic persists.
They state: “The Covid-19 pandemic and the actions taken by the governments of the countries that the group trades in have impacted and will continue to impact on its operations affecting Optical Express’s patients, employees and suppliers.
“The group continues to monitor the effect of any impact from Covid-19 and has demonstrated its ability to adapt to the changing restrictions and the effect this has on the group’s ability to operate.
“The ongoing health and safety of our employees and patients continues to be the directors’ primary concern.”
The directors add: “There is a risk of increasing unemployment and a reduction in patient spending levels in the different countries that the group operates in as government assistance to business reduces.”