Bremont is betting that its new facility in Henley, which is likely to open in 2019 and will bring all manufacturing, assembly and administrative functions under one roof, will transform the balance sheet for the business.
In accounts published this week for the 18 month period ending in June 2018, the company saw sales rise to £26 million but operating losses widened to over £3.2 million.
Capital investment rose from £300,000 in the 12 months of 2016 to £1.2 million in the most recent 18 month financial year. That includes the early costs of the Henley headquarters, additional infrastructure in key markets including the United States, and work to create Bremont’s first fully inhouse manufactured movement. It is hoped that the proprietary movement will be unveiled towards the end of this year.
Bremont co-founder Giles English suggests that turnover growth will outpace investment with only a small increase in sales.
“The investment in manufacturing will not pay off until we reach about 15% higher in revenue as the scale of investment especially in our machinery and new movement starts to pay off, all with its challenges. All our stores and markets are profitable in their own right and part of the journey we committed to by building in the UK. Work has also started on our new facility that we hope to be finished by July next year.” he told WatchPro.
Tracking performance for Bremont since 2013 is somewhat skewed by the company’s financial year changing twice in the past four years, but the trend for sales is consistently upwards. Mr English says that growth is running at around 22% per year on an adjusted 12 month basis.
Company director Robin Harding, who joined the company as chief operating officer in 2017, says Bremont has continued to invest ahead of anticipated growth in manufacturing infrastructure and is already seeing improved productivity. “Improvements continue to be made to the assembly process to help deliver better productivity and ensure the high quality of the watches,” he says in a statement accompanying the 2018 accounts.
“Research and development spend has increased as the company is progressing well with its plans to design and manufacture its own proprietary watch movement. This is a considerable investment for the future but essential to positioning Bremont within the ranks of high end watch manufactures,” Mr Harding adds.
John Ayton, an early investor and director of the company since 2009, left Bremont this year. He was bought out by other share holders, Mr English disclosed.