JCB issues warning as profits jump
Digger giant JCB has posted a jump in profits for the past year - and warned of 'challenging' conditions in the UK construction market. Its outlook is 'less positive' for 2024 as the slowdown in Europe has impacted demand for machinery.
Bosses said it has been knocked by weaker housebuilding after a surge in interest rates over the past two years impacted the mortgage market.
JCB chief executive officer Graeme Macdonald said the group saw sales grow last year despite the overall global machinery market shrinking. The company reported that turnover increased by 14 per cent to £6.5 billion for 2023, with machinery sales hitting 123,228. Pre-tax profits lifted by 44 per cent to £805.8 million for the year.
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It comes as JCB has agreed a three-year pay deal with its shop-floor workers and pledged to create 500 jobs. But its Tunstall warehouse shuts next year and relocates to Derbyshire - leaving dozens of Stoke-on-Trent employees out of work.
Mr Macdonald said: “North America remains the world’s largest market for construction equipment and JCB’s sales there grew strongly during 2023. JCB’s business in India also performed well in a growing market and while the UK market remained largely flat in 2023, JCB increased its share of the market.
“The full-year market outlook for 2024 is less positive, with challenging conditions in the UK and Europe, particularly in Germany where economic activity has declined sharply during 2024. In the UK, housebuilding activity has contracted, which is having a negative impact on machine utilisation.”
JCB chairman Anthony Bamford added: “Our family company, JCB, continues to invest both in new production capacity and in product innovation. Earlier this year, we broke ground on our new factory in San Antonio, Texas.
“The company’s ongoing investment in innovative new machines, such as the recently launched JCB Pothole Pro designed to tackle the global scourge of potholes, together with our continued focus on the development of hydrogen combustion engines for our equipment in the future, puts JCB in a strong position for further long-term growth.”
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