Pert Bruce hit with ‘strain’ of soaring costs
Angus construction company Pert Bruce has marked a return to pre-pandemic trading with a warning of the challenges of rising material costs and energy bills.
Having overcome the Covid-19 pandemic to report a £4 million rise in sales, the Montrose company said the latest financial pressures are adding a further strain to the business.
“We used our years of experience and we’ve got excellent staff and good relationships with key suppliers,” managing director Craig Bruce said.
“That has enabled us to mitigate a lot of the impact of the pandemic. I almost feel like I can forget about Covid. It was like a movie that we watched and it seems in the distance.
“We’re now seeing a different sort of challenge with soaring energy costs. It feels unrelenting.
“One minute it’s a lack of materials, where now we are getting materials but it’s the super-high costs we’re having to pay for them. We’ve got work to get to but we can’t make any money because the costs are too high.”
Mr Bruce told The Courier that the impact of rising fuel prices has been “huge” on businesses.
“Everything is delivered in a lorry or on a van. Absorbing those costs is difficult, especially when you tender a year out and sign a contract that has no fluctuation clause,” he said.
“We are then tied to absorbing these increases and that’s the difficult bit.
“However, we try to remain flexible and we’re also trying to advance purchase where we can once we get a contract by purchasing materials at the outset to offset rising costs.
“If we don’t do that, we risk losing margin on the contract through no fault of our own.”
He is anticipating a 10% rise in all costs – including labour – after a similar rise last year.
“It is just unknown,” he said. “In January we were forecasting 5% increase but the situation in Ukraine has supercharged that.”
Newly-published accounts show Pert Bruce’s turnover rose to £11.4m for the year to October 2021, up from £7.4m in 2020.
Its pre-tax profit also jumped from £97,972 in 2020 to more than £245,000 last year.
Mr Bruce was delighted with those results, a return to pre-pandemic trading. Sales in 2019 were £11.6m.
He said: “We’re happy to have returned to pre-pandemic levels. Our aim is always about £11m for turnover but it’s about being selective. If it means having £9m of good turnover, I’d rather that than just £11m of anything.
“This year we’ll have that secured. Demand is high, it’s just going to be making margin out of that demand.
“It’s about monitoring the overheads to make sure we make a return. We’ve been doing this for 150 years so it’s about working to our strengths.”