Cashmere producer braced for downturn
Cashmere and fine woollens producer Johnstons of Elgin expects sales this year to be down by more than 30 per cent amid the fallout from the coronavirus crisis.
Chief executive Simon Cotton pointed to the group’s “healthy” balance sheet and said he was preparing for a “slow recovery through 2021”.
In results filed this week, Johnstons of Elgin, which was founded in 1797 and runs two Scottish mills, in Elgin and Hawick, will disclose a profit before tax of £6.4 million, in line with the prior year, on sales of £77m.
Overall sales fell by 2.5 per cent, due to lower domestic sales, but exports continued to grow.
Cotton said: “Since these accounts were signed in late March the impact of the coronavirus has become apparent.
“Almost all our team have been furloughed for some period, as our mills and retail stores had to close during lockdown and have only recently fully re-opened.
“We expect sales for 2020 to be more than 30 per cent down and are preparing for a slow recovery through 2021.”
The firm, which employs 1,000 people, has retail visitor centres sited at its mills, a shop in St Andrews, an on-line store and flagship outlets on New Bond Street, London and Multrees Walk, Edinburgh.
Cotton added: “Although there will be short-term challenges, we remain very confident that our great team, the fundamental strength of our luxury branded partners and the growing appreciation of our own ‘Johnstons of Elgin’ brand puts us in a good position to thrive in the future.”