The sharp decline was accompanied by a 15.6% drop in turnover to £210.4m, which the firm attributed to wider uncertainty in the UK economy.

In accounts filed at Companies House, the company cited high inflation and interest rates as key factors dampening demand, particularly within the housebuilding sector. Directors Iain and Robin Bryant highlighted “relentless” pressure from rising costs, which saw operating profits slide by 29% to £5.13m.

In response to the challenging conditions, Scot JCB consolidated its depot network to reduce overheads, closing its Haddington and Fraserburgh branches without any redundancies. The company maintained its workforce at around 325 employees and held overheads steady at £20.8m.

Iain Bryant described the current market as a “sticky, fairly flat environment”, noting that hundreds of major infrastructure projects in areas like renewables and data centres are being won but are not starting, creating a bottleneck for growth.

The directors also voiced concerns over government policy. They warned that increased employer National Insurance contributions are discouraging business investment and expressed anxiety about the upcoming Budget. A particular worry is the UK government’s planned reforms to inheritance tax for farm estates, which they believe will have a “massive” and detrimental effect on their agricultural customers by taxing non-liquid assets.

Despite the difficult year, the company expects a slight increase in turnover for the current year and remains “cautiously optimistic” about seeing further growth next year.