Tandem Group returns to profit as sales rise

Tandem Group, the Castle Bromwich company behind a range of bicycles and home and garden products, has returned to profit in the first half of the year as sales rose.

Revenue grew by 6.7 per cent to 11.9 million pounds in the six months to 30 June, and the group made a pre-tax profit of 70,000 pounds, compared with a loss in the same period last year.

Margins improve

Gross profit rose by 15 per cent to 4.0 million pounds, and the gross margin, the share of sales left after the direct cost of goods, improved from 30.9 per cent to 33.3 per cent.

Adjusted earnings before interest, tax, depreciation and amortisation, a measure of underlying trading, rose to 374,000 pounds from 81,000 pounds.

What drove the growth

The company said new products, an expanded range in some categories and favourable currency movements had all helped. Like many businesses that buy goods from overseas, Tandem is affected by the value of the pound against the US dollar, which changes how much it pays suppliers.

About Tandem

Tandem Group is listed on the London Stock Exchange's AIM market and is based in Castle Bromwich, in the north east of the city. Its bicycle brands include Dawes, one of the best known names in British cycling, which was founded in Birmingham in 1926. It also sells a range of home and garden products.

A tough market

The bike industry has had a difficult few years. Sales soared during the Covid lockdowns, when people rushed to buy bikes, then fell sharply afterwards, leaving many retailers and suppliers with too much stock. Many companies were forced to cut prices to clear it.

Consumer spending remains under pressure from higher energy and fuel costs, and retailers say shoppers are being careful. Tandem's figures suggest it is finding growth despite that backdrop.