GWP Group: A Bumper Year for Packaging Manufacturers
, the sole UK manufacturers of , the industry-standard for conductive packaging, has successfully managed to turn COVID-19 into a profitable affair. in fact, the company has grown by more than £1mn, according to its latest financial results.
Across its five trading divisions, the company has recorded a turnover of £13.25mn for the financial period ending in October 2020, which is up from just under £12mn in 2019.
The secret to growth? Well, GWP Group produces a very large range of e-commerce, transit, and protective packaging, alongside specialist items including anti-static and returnable containers ─ these are increasingly popular products, which is made obvious by the companies 40 per cent growth since 2015 when the annual turnover sat at just £9.5mn.
Ruth Cook, managing director at GWP Group, said: "We are obviously delighted with the financial performance this year, particularly against the backdrop of the coronavirus pandemic and the unprecedented economic uncertainty.
"This is far and away the strongest performance we have recorded in our 30 years of trading, providing us with great confidence as we move towards 2021 and beyond."
The company, which celebrated its 30th birthday in August, continued trading throughout the national lockdown earlier this year, supplying a number of food producers, medical and pharmaceutical companies with packaging.
Ian Heskins, GWP Group business development director, added: "What has been really pleasing is that we have seen growth throughout all areas of our business. This includes our main corrugated packaging division just outside of Swindon, but our specialist foam and cases division in Salisbury as well. Sales of reusable packaging and handling products have performed better than expected too.
"And whilst our 2020 results continue the underlying trend we have been seeing for some time now, this years' figures have been achieved in incredibly difficult circumstances. It is a tribute to the hard work and commitment of all our staff, a number of which have been with us from when we began trading 30 years ago."
Founded in 1990, the GWP Group now operates from two manufacturing sites in Cricklade (near Swindon) and Salisbury, employing more than 100 staff.
IHS Markit/CIPS: UK Manufacturing PMI near-record high
UK manufacturing trends
For the UK manufacturing sector, growth of output and new orders were both reported by IHS Markit and CIPS as among the best seen over the past seven years, which in turn has led to a strong increase in employment. Despite this, the sector continues to face supply chain delays and input shortages, which resulted in increased purchasing costs and record selling price inflation.
UK Manufacturing IHS Markit/CIPS Purchasing Managers’ Index® (PMI®)
Seasonally adjusted, IHS Markit/CIPS Purchasing Managers’ Index® (PMI®) rose to 60.9 in April, which was an increase compared to March (58.9) and above the estimated 60.7 for April.
Increasing for the eleventh consecutive month, the latest readings are the highest since July 1994 (61.0). The output growth for April has been attributed to the loosening of lockdown restrictions, improving demands and a rise in backlogged work.
“The manufacturing sector was flooded with optimism in April as the PMI rose to its highest level since July 1994, bolstered by strong levels of new orders and the end of lockdown restrictions opened the gates to business. It was primarily the home market that fuelled this upsurge in activity though more work from the US, Europe and China demonstrated there were also improvements in the global economy. This boom largely benefited corporates as output growth at small-scale producers continued to lag behind,” said Duncan Brock, Group Director at the Chartered Institute of Procurement & Supply.
In addition to expanding production, total new orders rose for its third consecutive month, which was attributed to a revival of domestic market conditions, stronger client confidence, parts of the economy reopening and improving global market conditions.
While new exports rose in April, the rate was reported as weaker in comparison to new orders. “Companies reported improved new work intakes from several trading partners, including mainland Europe, the US, China and South-East Asia. Large-sized manufacturers saw a substantial expansion in new export order intakes, compared to only a marginal rise at small-sized firms,” said IHS Markit/CIPS.
UK Manufacturing’s outlook
Remaining positive at the start of the second quarter, 66% of companies forecast that output will be higher in a year's time, which is attributed to expectations for less disruption related to COVID-19 and Brexit, economic recovery, improved client confidence and new product launches.
“Further loosening of COVID-19 restrictions at home and abroad led to another marked growth spurt at UK factories. The headline PMI rose to a near 27-year high, as output and new orders expanded at increased rates. The outlook for the sector is also increasingly positive, with two-thirds of manufacturers expecting output to be higher in one year’s time. Export growth remains relatively subdued, however, as small manufacturers struggle to export,” said Rob Dobson, Director at IHS Markit.
Adding to comments from IHS Markit and CIPS, , Managing Director of Freight and Logistics at Accenture Global said: “While today’s figures are positive overall, the worsening supply situation is still a concern, with rates of both input costs and selling price inflation running far above anything previously seen. Shipping delays and material shortages are driving huge backlogs of uncompleted work and the surge in manufacturing orders is leading to many firms struggling to boost operating capacity to keep up with demand. With business expectations becoming even more optimistic as the economy rebounds, the big question will be whether firms will be able to cope with the surging inflows of new orders.
“As ongoing supply chain issues are still at large, companies with wide international footprints should look to reassess their logistics strategies by running supply chain stress tests and simulations in order to respond quickly to upswings and variability in demand. A flexible and resilient supply chain will be a key way for businesses to remain both competitive and stable as we emerge from the pandemic”