On a turnover of £52.4m in 1999 Raleigh made a pre-tax loss of £4.2m. In the previous year, losses had been kept under £1m.
In 1997 Raleigh made a pre-tax profit of nearly £4m on a turnover of £69m.
Its sad to report such losses but even from the bald figures given in this statutory company report its clear the Good Ship Raleigh is sailing though choppy waters. Painful as it is, its hard to say anything positive about Raleighs recent performance.
Sales have fallen by a third over the last four years.
Assuming 500 000 bike sales (it could be as much as 100k less than this), a pretax loss of £4.3m equates to nearly £10 loss per bike.
Stockturn is slowing down. It was 8.5 times per year not so long ago, in 1999 it was down to five times a year. Payments to creditors also slowed down and shareholders were getting less value: Raleighs net worth dropped from £10m to £6.1m.
In the light of such lacklustre performance its easy to see why selling the Raleigh factory site to the University of Nottingham was so attractive. Sure, its a run-down complex of old buildings, and bespoke new ones would be more cost-efficient to run, but if academia thinks it can make a go of the Triumph Road site, Raleigh may have been able to instead. To upsticks from the site youve been on for 100 years must have been a decision coloured by more than just cost-efficiencies three or four years down the line.
Raleigh needs to be turned around. Clearly, MD Philip Darnton has a tough task on his hands. Hopefully, Raleighs fortunes so far in 2000 have been boosted over those reported in 1999.
One man a worried man? keeping an eye on Raleighs performance is Gary Matthews, CEO of the Derby Cycle Corporation, Raleighs American owner. As the accounts reveal, he was made a director of Raleigh Industries Ltd. on 10th August 2000.