Johnstons of Elgin ramps up production following sales surge
Scottish woollen garment manufacturer Johnstons of Elgin is set to expand production following a robust sales performance and job creation despite a challenging economic landscape.
Led by CEO Chris Gaffney, The family-run business, headquartered in the Highlands with additional facilities in the Scottish Borders, reported an increase in turnover from £66.4 million to £83.5m last year, according to financial statements filed at Companies House.
Founded in 1797, Johnstons is a mainstay from Scotland’s golden era of textiles, producing a diverse array of woollen garments and has build a reputation for its cashmere.
The firm attributes its strong performance to a surge in demand from own-label customers and substantial investment in its in-house brand.
In the company’s latest filing, a spokesperson for the firm said: “We expect further growth in revenue due to a strong order book with private label partners as well as increased investment in our own brand.”
The uptick in business has had a positive ripple effect on local communities, with the workforce growing to an average of 1,105 people last year, including 790 in factory roles. This is an increase from the 902 employees in 2021, of which 620 were factory staff.
The directors remain optimistic about the future, projecting further revenue growth due to a strong order book and increased brand investment. However, they acknowledge challenges, notably in efficiency.
The rapid recruitment drive has slightly affected the company’s profit margins, dropping to 26.9% from 28.5% the previous year. Profit before tax was £3.3m in 2022, compared to £3.9m in 2021. Despite cost inflation partly eroding profits, the company plans to offset these costs through price increases.
The company maintained its annual dividend payouts at approximately £0.5m.