Van Elle Holdings made a pre-tax loss of £2.2m for the year ended 30th April 2020 on revenue of down 4.6% to £84.4m. The previous year it had made a profit of £4.0m before tax on revenue of £88.5.
Chief executive Mark Cutler said that the year’s financial performance was already affected by a downturn in the wider construction market even before Covid-19 wrecked the final six weeks of the financial year.
Most customer sites closed in late March and throughout April, reducing revenues by approximately £10m compared to pre-Covid expectations. In April, 80% of revenues were lost; this has recovered to 30% below normal levels at the end of July.
The directors do not expect the company to be back at full capacity until the end of January 2021.
At the peak of the -19 lockdown, Van Elle furloughed 50% of its workforce and pay reductions and other cost reduction measures were implemented. At the end of July, 25% of the workforce remains furloughed. Redundancies are planned, but fewer than 20, Mr Cutler said.
Van Elle’s balance shet was boosted in April by a share placing that raised £6.3m net.
Chief executive Mark Cutler said: "These results reflect a challenging trading environment that persisted for much of the year and which was significantly exacerbated by the impact of Covid-19.
"Our strategy remains unchanged: improving the operational performance of the business whilst developing positions for differentiation and growth with key customers in the housing, infrastructure and construction sectors.
"Despite the market conditions, we made good progress in the delivery of this strategic plan. The restructuring programme has been completed, with a streamlined divisional structure now in place. This, combined with the strengthened financial position following the successful share placing in April, means that the group is better positioned to return to growth as markets improve.
"I am extremely thankful to all our employees for their professionalism and commitment as we worked through the last five months. Our teams have been flexible in adapting to the changed working methods in the construction sector. Importantly, Van Elle has retained its skill-base and capacity to be able to respond to recovering demand.
"Throughout this challenging period the group is also grateful for shareholder and UK government support and, with an improved cash position, now has liquidity headroom to support future growth.
"FY2021 has started encouragingly, with activity levels recovering slightly ahead of our expectations and we look forward, subject to no further significant business interruptions arising from any further Covid-19 disruption, to returning to full operational capacity by the end of Q3 FY2021.”