Johnstons of Elgin is battling a tougher 2012 after a mild winter, but is continuing to blaze a trail for Scottish textiles in a cold economic climate.
The family-owned north-east business has reported a buoyant 2011 in accounts just published, lifting turnover by 8.5% to top £50 million for the first time, and hiking its operating profits by 23% to £2.58m. In May it opened a new retail centre at its Borders site in a £1m investment, and managing director James Dracup said it had so far "exceeded expectations".
However, Mr Dracup told The Herald the current year was generally proving slower. "We are working very hard to reduce the seasonality of our business by introducing lighter weights of fabrics and new business channels such as furnishing fabric, but to a large extent we are still an autumn/winter cold weather business."
The mild winter had led to customers holding higher inventory at the start of the year, whilst global uncertainties had also affected its business with private-label clients in
developing markets such as China. "The rate of growth has probably slowed down, and generally across the business spectrum people are very conscious of cash and are running stocks down."
Mr Dracup said the retail complex carved out of the company's 1797 Elgin mills, which receives 200,000 visitors a year, had been the model for a smaller version at its Eastfield Mills building in Hawick.
"It is early days and we believe we have an awful lot more work to do in marketing the site, but we are highly encouraged by the results so far." The new centre has created 15 jobs and helped preserve the 250 on site.
The accounts for 2011 show Johnstons added 20 to average employee numbers at 779, though Mr Dracup said this year would probably see a small decrease overall.
The debt-free group, chaired by Johnstons family member Ian Urquhart, ended the year with a £3.5m increase in cash at £6m. Just over one-quarter of its £51.2m turnover was international.
The highest-paid director earned £208,000 including pension contributions, up from £201,000.
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