Mill boss confident despite pre-tax loss and rising costs

Nick Bannerman, managing director of Johnstons of Elgin
Nick Bannerman, managing director of Johnstons of Elgin

After recording a pre-tax loss last year, the managing director of Johnstons of Elgin has said there will be ‘further challenges’ ahead.

The firm, which employs several hundred people at Hawick, saw a £2.6million profit in 2011 turn to a £1.8m pre-tax loss in 2012, with turnover also falling by £5m, to £46m.

Mill chief Nick Bannerman said: “Nobody ever said manufacturing was an easy business to be in, and we certainly know we can perform better than we’ve done of late.

“Cashmere fibre prices are rising so there will be further challenges to come, however we have tremendously skilful and experienced people throughout the company allied to a real passion for making cashmere and fine woollens here in Scotland, and remain confident that Johnstons still has great potential for further profitable growth.”

Mr Bannerman added: “Obviously our financial results to December 2012 were a disappointment for the company but were mainly based on a drop in UK-based sales from our weaving division in Elgin. However, we remain financially strong as a company and have been much busier this year, and these facts, coupled with the appointment of a new operations director, a new creative design director for the business, and a new chief executive in Elgin, mean we feel well placed to take the company forward strongly into 2014 and beyond.”

The drop in sales has been largely blamed on last year’s mild winter in key markets and reduced orders.