OMB 100 shows sales up 6.6 per cent but pre-tax profit down 15 per cent as payroll costs climb £173m
Rising wage bills have wiped 15 per cent off profits at Scotland’s biggest owner-managed businesses.
The latest accounts of Scotsman Insider’s OMB 100 show the 99 companies with comparable figures grew turnover 6.6 per cent, but pre-tax profit fell from £1.06bn to £905m.
Combined wage bills rose £173m, more than the £160m fall in profit.
The OMB companies kept 5.6p in pre-tax profit from every £1 of sales, down from 7p on the previous year.
Only 42 of the 99 grew profit, against 57 that increased sales.
Castle View and JW Filshill are among those to point to higher employment and National Insurance costs in recent months.
Paul Mason, head of corporate finance at CT, said: “There are things you can’t do anything about – inflation, cost of funding. But what you can do is make really, really high-quality decisions on talent, on supply chain, on customer targeting, your go-to-market. Do those things well and better than your peers, and you will be more successful.”
The north east bucked the trend, with four of the six biggest profit risers based in Aberdeen, Moray and Buchan.
Sir Jim Milne’s Balmoral Group trebled profit to £32.1m, Forsyths of Aberlour added £10m to reach £23.7m and Fraserburgh’s Gray & Adams rose £7.1m to £25.7m.
Nor is the fall down to the biggest names.
Arnold Clark tops the ranking with pre-tax profit of £112.5m on turnover of £5.56bn, but excluding it, margins fell from 9.4 per cent to 7.3 per cent.
DC Thomson was the biggest faller, with profit down £62.8m, yet comparable profits fell 10 per cent without it.