Newport-based Premier Forest Group is predicting further significant rises in both turnover and profit as it continues to successfully navigate the global supply issues in the timber industry, caused by the pandemic.
With just four months to go before the end of their financial year in April, Premier Forest Group is confidently forecasting that its annual turnover in the UK will have increased by 35% to circa £120M, and that profits will have jumped from £8.8M to over £20M, a growth of 130% since last year.
This is in part thanks to the sale of Premier’s Irish timber group in the summer of 2021. Brooks Timber, Premier’s biggest company in Ireland, was rescued from the verge of bankruptcy by the Premier Forest Group nine years ago, and was successfully reengineered into a highly profitable operation, rising to become the second largest builder’s merchant group in the Republic of Ireland. The sale freed up significant capital for Premier Forest Group, allowing the directors to further increase investment in its core UK business, Premier Forest Products.
Managing Director of Premier Forest Products, Joe Walker, said: “The ability to invest even more this year has fast-tracked improvements in operational efficiency and productivity. It’s further enhancing our ability to respond to, and capitalise on, the opportunities presented to us. Looking ahead, the focus for us will be very much on organic growth and suitable acquisitions.”
Premier Forest Group made significant IT investment in 2021, with the company’s first foray into e-commerce for the Mill Timber brand. For the first time, the Mill Timber Direct website, which carries over 1000 products, allows customers the ease of ordering online for delivery direct to site.
New products have also proved successful. Premier Forest Products has a long history of finding innovative and environmentally sustainable alternatives to existing, less effective products in the market. With customer surveys conducted by the business indicating a distinct appetite for new solutions to long-standing problems, the successful introduction of high-quality new products that save time and money will continue to be a key strength for the company.
Further developing and strengthening the management team of the business is another core objective. Recently this was given a significant boost with the appointment of Andrew Francis as UK Sales Director. Andrew, a highly respected figure in the industry, is setting ambitious plans for growth in motion.
Premier’s plans for 2022 are very much focussed on further significant expansion. The board of directors is already considering several potential acquisitions that would be a good fit for the existing organisation.
Terry Edgell, Founder and CEO said: “The sale of our Irish group, which included Brooks Timber and Building Supplies, Dublin Plywood and Veneer and Premier Forest ROI ltd, was done as part of our wider strategic planning.
“If we hadn’t of sold our Irish assets our group turnover for the current year would have been approaching £220million, our goal now is to replace this lost turnover as quickly as possible through a series of small, strategic acquisitions and with strong under lying organic growth.
“We are hoping to close an early acquisition at the start of the year, if we do it will result in a further £30 million growth in turnover for the next financial year, supplemented by the 15-20% forecasted organic growth.
“I’m optimistic for 2022 and, based on what we’ve seen in the last quarter, I believe the market is looking robust for the new year. The pipeline is stronger than we have ever seen, with stocks as high as they’ve been, which is no small feat given the supply chain challenges we have faced over the last 12 months.
“To be frank, the biggest barrier to growth we faced in 2021 was that we could have sold more if we’d had it. Although we worked hard with our supply chain partners to have continuous supply of product wherever possible to support our customers in challenging times, we saw numerous sectors who had to slow down production based on product availability. Hopefully, this is something we’re all in the process of addressing.
“The past two years have demonstrated just how resilient our sector can be and with pent up demand, government funded infrastructural investment and a national housing shortage, all signs point to a serious demand for timber products in the short, medium and long term.
“Of course, covid is likely to present an ongoing challenge, especially with the Omicron variant causing issues now and other potential mutations likely in the future, but we have learnt to work smarter, using hybrid working wherever we can. It has been more of an issue on the operational side and in December we were hit hard by cases amongst staff. However, we are doing everything we can to protect the team by reducing contact and making the working environment as safe as possible.
“Looking ahead to 2022/23 there is going to be continued focus on climate change and the need for businesses to move towards net zero. Reducing our carbon footprint has been on our agenda for many years now and I like to think that we’re ahead of the game in terms of our environmental impact, but there is always more that we can do and we will be continuing to invest in green technology next year and beyond.
“This is a very exciting time for Premier Forest Group and I’m really looking forward to the challenges and opportunities that the next twelve months will bring.”