Premier Modular’s latest financial results reveal a downturn in profits, despite consistent market engagement. It remains resilient in a competitive industry by adapting to changes due to the pandemic.
- The company’s turnover decreased by 6% to £105.7m, with a notable decline in pre-tax and operating profits.
- Sales from the modular building fleet doubled, providing a buffer against the reduction in overall turnover.
- Revenue from construction contracts and modular building delivery saw a substantial decline, impacting financial results significantly.
- Premier Modular remains optimistic about future growth prospects despite current challenges and profit dips.
In the financial year concluding on 30th June 2023, Premier Modular reported a 6% reduction in turnover, tallying up to £105.7 million, down from £112.5 million in 2022. Alongside this, there was an 11% decrease in pre-tax profits, which fell to £14.7 million, coupled with a 16% drop in operating profits, landing at £13.9 million.
Despite a dip in overall turnover, the company experienced a notable increase in sales from its fleet of modular buildings, doubling from £11 million to £22 million. Additionally, revenues from the hire of modular buildings saw a slight increase, rising from £18.8 million to £19.6 million. These segments provided a cushion against the broader declines experienced elsewhere.
However, the construction contract revenue decreased from £51 million to £49 million, and revenues from the delivery and erection of modular buildings experienced a severe drop, plummeting from nearly £32 million in 2022 to less than £15 million in the subsequent year. This notable downturn was linked to the winding down of national COVID-19 measures, particularly the provisions made for NHS Nightingale centres.
The modular rental business experienced a turnover dip from £62 million to £57 million, whereas the permanent space division saw its turnover decrease from £51 million during the preceding financial year to £49 million in 2023. Nevertheless, these numbers have not shaken Premier Modular’s confidence in its market position.
Chief Executive David Harris expressed optimism in the company’s annual report, stating that Premier Modular occupies a unique market position with its infrastructure-type revenue streams and predictable cash flows. He highlighted the company’s strong rental business and ability to provide superior solutions compared to traditional construction methods as key factors bolstering its potential for growth.
Situated in Driffield, East Yorkshire, Premier Modular stands in the vanguard of the UK’s modular building industry. Despite ownership by Cabot Square Capital Partners, the company’s strategy focuses on expanding its market share through quality solutions.
Premier Modular is poised to navigate its present challenges and leverage its strengths for future growth.
