William Sinclair Holdings records £0.4m pre-tax loss in year to September 2012

William Sinclair Holdings has recorded a full-year pre-tax loss of £0.4m, after a profit of £3.18m in 2011, blaming wet weather for its poor performance.

Bernard Burns: customer supply pledge
Bernard Burns: customer supply pledge

Sinclair chairman Bill Simpson said: "Our performance was badly affected by the highest ever recorded rainfall and generally unfavourable gardening conditions.

"Whilst the early part of the selling season was reasonably dry and warmer than normal, by the vital selling days at Easter and the bank holidays in May, we were experiencing unprecedented rainfall from which the selling season never recovered.

"We believe that total sales of growing media to the retail market fell by 19 per cent in the year to July 2012. By contrast, sales of chemical products either increased or held at previous levels as gardeners sought to counter the effects of the poor weather."

"Sales to the professional growers held up well in a market made more difficult because of the weather and also the continued weakness of the euro and the increased competitiveness of imports as a consequence. Overall, our horticulture sales fell by 14 per cent.

"Freeland, our top soil and green waste processing business had a good year with sales up eight per cent.

"We are committed to close our Bolton Fell facilities and the legal process to determine compensation is underway.  We lost a planning appeal at Chat Moss in Greater Manchester and no further peat extraction on this site can now take place.  Amongst the reasons given for this planning decision, the inspector's statement that it is government policy to try to ration peat by increasing its cost was news to us and is, we believe, further evidence of the lack of cohesive thinking on the subject."

William Sinclair also appointed a new chief executive, former Hozelock MD Peter Rush, who takes over on March 1.

Outgoing CEO Bernard Burns added: "By 2014 it should return to the growth levels seen in 2011."

"The "once-in-a-100-years" wet weather severely impacted the European peat harvesting and garden retailing industries and the company’s profitability suffered as a consequence. Despite the severely curtailed  harvest, William Sinclair’s customers will receive their supplies of peat based products in 2013.

"Significant strategic milestones were achieved during the year and William Sinclair is now well placed to take long term advantage of its technical superiority over its competitors and increasing logistic strengths as the output at the new Ellesmere Port site begins to ramp up and the horticulture market returns to growth.

"The industry-wide raw material shortage will lead to significant price increases, although these price increases are unlikely to fully cover the rise in raw material costs. This will lead to margins in 2013 being slightly below those reached during 2011."

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