Brother Industries UK Ltd reports profitable growth and cost reduction initiatives in FY2023.
Brother Industries UK Ltd, is a wholly owned subsidiary of Japan’s Brother Industries Limited and a leading OEM. In the fiscal year ending on March 31, 2023, the company achieved revenue of €57,111,023 ($63,078,816), an increase when compared to the previous year’s revenue of €56,785,125 ($62,718,708). The company attributed the growth in sales of third-party products and remanufactured toner cartridges.
A key factor contributing to the company’s improved financial position was the profit before tax of €1,798,307 ($1,986,215) in FY2023, a significant contrast to the loss of -€163,605 (-$180,709) in the previous year. Notably, this positive shift was primarily driven by profit from toner cartridge sales.
The company’s gross margin experienced a boost, supported by agreements on sales prices with Brother Industries Limited and the successful implementation of cost-reduction initiatives. Automation of production processes and process efficiency improvements resulted in reduced labour costs. Additionally, the adoption of energy-efficient equipment, such as solar panels, LED lighting, and voltage optimizers, not only cut costs but also reduced CO2 emissions.
The balance sheet for FY2023 showcased a strengthened financial position, with net assets reaching €29,526,881 ($32,616,032) compared to €28,019,106 ($30,950,511) in the previous year. The decrease in inventory levels was due to efficient stock usage, while the increase in receivables can be attributed to higher sales, particularly in March, along with an increase in the cash balance held in the pooling facility. Meanwhile, liabilities reduced, driven by lower purchases and decreased goods in transit values.
Cash flow management was a priority for the company, with monthly KPI and P+L meetings conducted to ensure financial health. By the end of FY2023, the cash level aligned with the company’s parameters, reaching €5 to €7 million ($5.2 to $7.73 million), and experienced a notable increase of €3.3 million ($2.23 million) compared to the previous year. Throughout the year, an average of €6 million ($6.62 million) was maintained, with most of the cash held in the readily accessible group cash pooling facility.
The company’s core focus centres around the manufacture of laser printer cartridges, franking machines, and injection molding. Additionally, it operates a Recycling Technology Centre (RTC) for the group. Notably, there have been no significant changes in its principal activities during the past year.
