Brexit has delivered a boost to Britain’s biggest boatbuilder with Princess Yachts revealing that the crash in the pound helped it secure extra sales.
Speaking as the Plymouth-based company showcased four new vessels at the Cannes yacht show, chairman Antony Sheriff said buyers had taken advantage of sterling’s weakness, gifting the business a “windfall”.
“Especially on the larger boats we have customers who are financially savvy and they have seen this as a unique opportunity to save money without having to negotiate,” he said. “People have seen the pound move and taken the decision it is a very good time to buy.”
Princess builds between 200 and 250 yachts a year costing from £300,000 to £20m, but declined to put an exact number on the amount of sales made.
“It is very difficult to predict what is gong to happen as a result of Brexit but we are seeing a lot of activity in the non-sterling area,” Mr Sheriff said. He added that the company would not change its plans to target this group, but was simply “taking advantage of what felt like a reasonably good opportunity”.
Princess – part of the LVMH group – admitted that its costs were “a little higher” in the wake of the EU referendum, with the company importing major components such as engines and drive trains for vessels.
Looking ahead to the future Princess – which builds boats ranging from 39ft to 131ft in length – expects revenue to rise this year, along with the number of vessels it produces. Princess’ last accounts show it had a turnover of £239m in 2014.
In January the company said it was cutting up to 350 of its 2,300 staff as it eased off on development of new boats; in the end it cut 171 employees.
Mr Sheriff said he “did not see [headcount] changing in the near future”.
Also showcasing its range at Cannes was Poole-based Sunseeker International, with chief executive Phil Popham revealing demand for its yachts had exceeded the forecasts it made under his turnaround plan.
Mr Popham, who joined from Jaguar Land Rover almost two years ago, said the company was back in profit in the second quarter of 2016, with a full-year profit on the horizon. This is a year ahead of schedule in Sunseeker’s three-year strategy.
Sunseeker, which produces about 120 boats a year, lost £41m on sales of £195m in 2014, though Mr Popham said this figure had been reduced by two thirds to a loss of £13.6m in 2015, though the company’s full accounts for the year have yet to be published.
“We are confident of achieving a strong profitable future and will continue to invest heavily over the next five years,” he said, adding that its new owner Wanda Group was investing £50m into new products and facilities to improve the company’s performance.
Both boat builders are major exporters, with 98pc of Sunseeker’s vessels and 80pc of Princess’ boats going abroad. The firms said they were looking for certainty from the Government on how future trade deals would be worked out.
“What we need is a clear timetable of what will happen and when on the road to Brexit,” said Mr Popham. “That will give confidence in how to proceed.”