While the demand for leather from the international market remains depressed, the UK-based group predicts better results for the 2nd half of this year than in the 1st half, which continued to be affected by deteriorating market conditions and by the weakness of the US dollar. Pittards’ three divisions all had operating losses in the 1st quarter, but in the 2nd quarter the glove leather division and the shoe and leathergoods division became both profitable thanks to increased volumes and cost cuts.
The raw materials division continued to struggle and the group had started negotiations with its staff in view of its possible sale or shutdown. Robert Paisley, managing director of the division, has resigned. Also John Pittard, a member of the group’s founding family, has decided to take this opportunity to resign from the position of group CEO, having reached the age of 60 after more than 40 years of service. The executive directors of the group will now report to Stephen Boyd, a chemical engineer who has spent five years as CEO of Capital Industries plc. He has been appointed as deputy executive chairman.
Pittards reports a pre-tax loss of £1,177,000 (€ 1,726,000-$2,119,200) for the six months ended last June 30, compared with a profit of £817,000 in the same period a year ago. The turnover fell by 12 percent to £38.5 million (€56.5m-$69.3m), with drops of 5.3 percent in the glove leather division and 14.6 percent in the shoe and leather division. Volumes were down by 21.3 percent in the latter division, mainly because a year ago they had been boosted by a marginally profitable program for sports shoes that has not been repeated. Volumes recovered sharply in the 2nd quarter and orders in hand indicate that the division will be much busier in the 2nd half.