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Brompton’s profits were almost wiped out after a challenging year in which the British bike maker sold less than expected amid “global economic uncertainty”.
The folding specialist, founded in 1975 by Andrew Ritchie, reported pre-tax profits of just £4,602 for the 12 months to March 31, down from £10.7m a year earlier.
Group turnover fell 5.3 per cent to £122.6m, mainly dragged down by lower sales in the UK and Europe, according to a Companies House filing. The company posted an after-tax loss of £1m.
The results mark a sharp decline in the fortunes of Brompton, which has grown in recent years to become Britain’s biggest bike maker, and in October launched a £2,399 Line Gwhich has larger wheels than the rest of its line and stronger brakes to handle off-road trails.
Brompton said the decline in sales was driven by a difficult economic climate and “challenges in the cycling industry” following a boom in demand for bicycles and cycling products during the Covid-19 pandemic. It added that the company missed “budgeted sales” and struggled to quickly cut costs because most of them were fixed.
The privately held company, which employs 844 staff, raised £19m in May 2023 in a funding round led by BGF, a £3bn UK investment fund backed by five major banks, pay the debt and accelerate brand growth.
It sells its products through stores, the Internet, retailers, distributors and franchisees, and exports account for 80 percent of unit sales. They said they continued to see a shift towards more premium products, which partially offset the decline in revenue as fewer bikes were sold.
However, operating costs rose 15 per cent to £62.7m, equal to just over half of revenue, due to increased spending on staff and marketing related to growth ambitions. Sales of bicycles reached 84,899, which is a drop of 8.2 percent compared to the previous year.
During this period, the company became a “B Corporation”, a movement that promotes a balance between profit and sustainable business practices.
Brompton did not immediately respond to a request for comment.
