Lords reveals record revenue, but profits slide for 2023

Builders merchant group Lords turned over £462.6 m for the year ended December 31 2023, the group revealed this morning (May 15). This figure was up 2.8% on the previous year, however pre-tax profits, at £10.4m, were 40% down 2022, due to interest costs, depreciation and amortisation.

The merchanting division saw revenues decrease 2.6% to £214.9 m, with LFL sales down 6.3%, reflecting price deflation in some product categories.

The plumbing & heating increased revenue by 8.0% to £247.7 m, 3.7% higher on a like-for-like basis, benefitting from extended product ranges at higher margins such as renewables. Mr Central Heating opened a new site in Edinburgh and will seek to establish a 50 branch network in the medium term.

The group added six branches and 93 colleagues to the Merchanting division, with the acquisitions of Chiltern Timber Supplies and Alloway Timber.

Post year-end the Board announced the appointment of Stuart Kilpatrick as CFO, a highly experienced finance executive with a track record in public company M&A, who will be joining the Board on 4 June 2024.

Shanker Patel, Chief Executive Officer of Lords, said: “FY23 has demonstrated that we have successfully built a sustainable growth business. Despite the challenging macroeconomic backdrop, the Group has once again grown its top line and gained market share, while continuing to invest to deliver future growth.

“While short term trading pressures may exist, I remain confident in our strategy and its ability to deliver sustained growth over the medium term. Our market remains substantial, highly fragmented and we have a track record of consolidation and organic growth which combined deliver excellent returns for all of our stakeholders.”

Patel told a meeting of investors and shareholders: “Integration of acquired businesses is never an easy process, and that’s something that we are mindful of. We take our time trying to win the hearts and minds of our new colleagues. The way we work through is by investing in these businesses that have been acquired.  Having done this 15 times since 2016, we apply the same processes, we are very focussed on integrating the customers, but first we want to integrate the colleagues, as it is through them that we will find the performance benefits, alongside our investments.

“I would like to thank all our colleagues for their efforts in our resilient performance, we recognise the step back in our profitability, but we are also very confident about the medium-term opportunities, both organic and acquisitive for the business, and we are very well placed to take advantage of the market as it starts to turn into better trading in 2024 to 2025.”