(UK) — Earth moving equipment manufacturer JCB posted record profits in 2012 and expects growth to continue this year, with a recovery already well under way in the US construction sector and expectations of a rebound in the UK prior to the year’s end.
The family-owned UK firm reported that earnings before interest, tax, depreciation and amortisation for the year ended December 31 were 365 million UK pounds, marking a three per cent gain on the figure of 355 million UK pounds for the previous year.
JCB achieved the impressive gain in earnings despite a two per cent decline in sales to 2.7 billion pounds from 2.75 billion pounds in 2011, and a 10 per cent decline in global sales from 930,000 units in 2011 to 845,000 in 2012.
JCB sold 69,250 of its yellow excavators in 2012 for a slight year-on-year gain. The 2012 sales figure for its flagship product is nearly twice the number seen in 2009 just after the global financial crisis, when only 36,000 units were sold.
JCB also lifted its market share with an increase in sales in the Americas of a fifth and a doubling of business in Africa.
JCB chairman and chief shareholder Sir Anthony Bamford says the company anticipates further growth in 2013.
“Despite continued uncertainty, particularly in European economies, 2013 has started satisfactorily. We are expecting some growth this year, but how much will depend on the pace of the global recovery,” he said.
JCB’s strong performance stands in stark contrast to its chief rivals in the earth moving machinery market, such as Caterpillar, which weathered tough times in 2013 as a result of weakness amongst its mining clients.
Caterpillar recently announced that it would cut 2,000 jobs at facilities in North America and the EU due to the slump in the global mining sector.
While anticipating a boost in growth from the recovery of the North American and the UK construction sectors this year, JCB continues to expand aggressively into developing economies, which have the fastest growing markets and present the most opportunities.
Last year, the company invested 62 million pounds in a manufacturing facility at Jaipur in the Indian state of Rajasthan, and commenced operation of a 60 million pound manufacturing plant near Sao Paolo in Brazil.
By Marc Howe