The Director of iconic British bicycle manufacturer Raleigh believes the company is still in a "strong position" despite a loss of £30 million in 2023 being revealed in its up-to-date accounts.
Raleigh last reported a pre-tax profit in 2021 of £127,000, with 2022 taking in a loss of £6,826,000 and 2023 seeing that figure more than quadruple to a loss of £30,146,000.
The accounts filed at Companies House did show that Raleigh's turnover increased to £57.7 million in 2023 from £55.7 million in 2022, however, this figure was well below the 2020 turnover of £74.4 million. Also, in the same four-year period, the company's operating costs increased from £71.3 million to £84.4 million.
“The directors anticipate that the market place will continue to be very competitive during the coming year. Raleigh retains a solid competitive position with considerable brand strength, an independent bicycle dealer network and a strong presence on the high street," read a statement reviewing the business, signed by Director Chris Slater.
"The uplift in the market driven by COVID has seen some contraction and volumes have returned to pre-COVID levels. As a result, this has left the market in an overstocked position and we have experienced price pressures in the market place.
"As a result, a full business review was performed at the end of 2023 and the business was right sized and strategic changes to the business structure and product offering were made to protect the business. These changes have left the company in a strong position when the market returns to a more normal and stable state."
The Nottingham-based company, founded in 1887, was purchased by Netherlands-based bicycle company Accell Group in 2012, which also owns bike brands such as Haibike, Lapierre and KOGA.
Accell Group also reported a net loss in 2023, of €390 million, after their revenue dropped 10% between 2022 and 2023 from €1.43 billion to €1.29 billion. After another downward year in 2024, CEO Tjeerd Jegen insisted the parent company's "recovery is well on track across the business."
"During 2024, the industry downturn continued. The market still faced high inventories at both manufacturers and dealers, while global economic factors impacted demand," said Jegen in a press release.
"The consequence of this was significant discounting and, ultimately leading to another year of decline. To weather the difficult market conditions, Accell has further streamlined its organisation, transforming into an integrated player. By leveraging its strong European manufacturing footprint and reducing operational complexity, the company is better positioned to drive efficiency and deliver value."
Raleigh's continued existence is dependent on continued financial support and liquidity security from its parent company. The report also stated that Accell Group "has indicated its intention to make available such funds as are needed by the company" despite experiencing its own downturn and financial restructuring.
“[Raleigh]'s ability to continue as a going concern is dependent on non-withdrawal of existing funding and additional financial support being made available by its parent, Accell Group BV," read the report.
"The ability of Accell Group BV to provide this support is dependent on the successful and timely completion of the recapitalisation and the timing and extent of market recovery, and in case of liquidity shortfall, its ability to obtain and agree to any additional super senior debt financing required."
