JCB builds on UK construction boom

Lord Anthony Bamford
Lord Anthony Bamford
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Yellow goods giant JCB said earnings remained above £300m for a fourth successive year as a construction boom in the UK helped offset tougher conditions in emerging markets.

The privately-held firm posted annual earnings down 3.2 per cent to £303m as machine sales fell 3.3 per cent to 64,028 and revenues slipped 6.3 per cent to £2.5bn.

Slowing economies, lower oil prices and geopolitical unrest affected some of the world’s most prominent developing nations.

The 69-year-old Staffordshire-based firm said the construction equipment market in Brazil dropped by 17 per cent last year, Russia fell by 27 per cent, India by almost 15 per cent and China by 17 per cent.

By contrast construction markets in the UK jumped by 30 per cent and lifted by 13 per cent in the US.

JCB chairman Lord Anthony Bamford said: “For different reasons each of the Bric markets - of Brazil, Russia, India and China - were sharply down in 2014.

“However, the broad spread of our business enabled us to benefit from better conditions in North America, Western Europe and particularly the UK.”

The firm, which employs 12,500 staff, sells heavy digging machines in more than 120 countries.

Lord Bamford added: “Global market uncertainty has continued into 2015, though our home market of the UK remains a rare bright spot.

“The need for infrastructure in much of the developing world remains acute and will eventually drive a resumption of growth.

“Our resilient performance in 2014 demonstrates we are well placed to capitalise on improving trends as they emerge.”

The business said it had created 2,000 new jobs at its 11 UK plants since 2010, adding that it was currently increasing production capacity at its head office complex in Staffordshire.

It is also building a new £18m head office site at its German business, and last year it opened a 70,000 sq ft factory in Jaipur in India that cost £62m.

Lord Bamford added: “We continue to invest heavily in all areas of our business despite the difficult markets, and this is the best demonstration of our confidence in the future.”

His father Joseph Cyril Bamford started the JCB empire in a rented lock-up garage in 1945.

In 1956 he established JC Bamford Excavators Ltd, which became famous for making bright yellow backhoe loaders. It remains the group’s main operating company.

Lord Bamford is one of Britain’s best-known business leaders and a prominent political donor.

In the past five years he has given £2.6m to the Conservatives and in 2013 he became a Tory member of the House of Lords.

The billionaire peer has urged politicians to provide more incentives for companies to invest in manufacturing, and JCB group has a reputation for reinvesting more of its profits in developing new products than do listed companies with dividend-hungry shareholders.

“JCB may be a global company, but first and foremost we’re British and we invest heavily in Britain,” Lord Bamford was quoted as saying in 2013.

JCB is the world’s third largest construction equipment manufacturer by volume. It has 22 plants on four continents. The group’s 11 British plants export more than 75 per cent of production.

The group’s dealer in Yorkshire is TC Harrison, based in Sheffield, which sells more than 1,000 new and used JCBs every year.

TC Harrison JCB serves a market stretching from the River Tyne in Northumberland to the River Welland in Lincolnshire, with dealerships and depots at Sedgefield, Derby, Lincoln, Chapeltown and Leeds and a training facility in Doncaster with the Construction Training Academy.