John Pattison, the new CEO of leading independently owned home furnishing specialist Sterling Furniture Group says he envisages “exciting times ahead" in the business' 50th anniversary year, as it reflects on the “prompt and decisive action” it has taken to address issues affecting the firm’s financial performance.
The group’s latest accounts for the 18-month period to August 2023, published today, point to a challenging period when trading was adversely hit by the combined impacts of reduced consumer confidence post-pandemic and the cost of-living crisis, as well as the ongoing instability of the geopolitical situation and its effects on the supply chain.
Turnover grew from £55.5m in February 2022 to £83.7m in August 2023, while pre-tax profits dropped from £4.2m to £43.9k, with the results for the prior period incorporating the end of Covid 19-related reliefs such as furlough and the non-domestic rates support.
In its accounts, Sterling Furniture Group acknowledges that “the material decline in profitability for the period is also reflective of the historic lack of action taken to address the cost base of the business given reduced sales revenues and inflationary cost pressures”.
Founded in late 1973 by George Knowles, the Tillicoultry-based firm last year appointed industry veteran John Pattison as its new CEO. Since taking up the role last August, John has spearheaded a new direction of travel for the business, working with his team to hire key senior personnel, instigating a change in approach to company values and staff communication, securing new funding with Royal Bank of Scotland (which Sterling expects to formalise over the coming weeks), and mapping ambitious plans for the years ahead, including new stores, starting with a 50,000 sqft Sterling Home store in Hillington, Glasgow, which is set to open by the end of the year.
John says: “It’s undoubtedly been a challenging period, we needed to take prompt and decisive action to set ourselves back on a sustainably profitable course, but I firmly believe that there are exciting times ahead for Sterling, all our colleagues and customers. To that point I really want to thank all the Sterling team for their incredible hard work, commitment and support in my first nine months, where we’ve made several significant changes across the group.
“We’re powering ahead with the major rebrand to our Sterling Home marque and our leadership team has been reinforced by a number of significant senior hires that have already put the company in the best possible position as we build on the legacy created by George Knowles and embark on the next 50 years.
“This is a historic Scottish company with a long-cherished reputation for quality and we’re brimming with ideas for how we’ll ensure Sterling is leading the way as the home of inspiration for Scottish consumers.
“We’re delighted to have received, and agreed, credit approved terms for a £10m banking facility from Royal Bank of Scotland, which we expect to confirm terms on over the coming weeks. In addition to consolidating Sterling’s existing term borrowings, the facility provides expansionary funding, in the form of a revolving credit facility, to support the exciting growth and development of the Sterling estate over the next five years. Working with a Scottish bank that wants to support us to grow is hugely important, and the team at RBS have listened to our plans and really stepped up to work with us. We’re really looking forward to working with them.
“Through our refreshed leadership team, clear vision for growth, ‘right-sizing’ our cost base and our exciting new store plans – starting with Hillington in the coming months – we are looking forward to Sterling’s next 50 years with optimism and confidence.”
John has appointed four new directors to the leadership team since joining: CFO Kenny Barclay; IT director Matt Bonar; people director Donna MacPhee; and commercial director Silvia Hernandez.
These new directors join Sterling founder George Knowles’ family members Euan and Murray Graham, who sit on the group and executive boards, and George Smith Knowles, who sits on the group board.
Sterling Home will be broadcasting new ads in Scotland throughout July and August, including 135 10-second spots during Good Morning Britain on STV to complement the wider summer sale campaign due to launch on 3rd July.
Pictured: (front) George Smith Knowles, Donna MacPhee and Kenny Barclay, and (back) Matt Bonar, Murray Graham, John Pattison and Euan Graham at Sterling Home in Dunfermline (photo by Mike Wilkinson)
