Electrical appliance manufacturer Ebac has reported a significant increase in annual losses following a major restructuring, but its leadership insists the firm has now "turned the corner" and is poised for future profitability.
Financial Results and Strategic Closure
The County Durham-based company, which produces washing machines, dehumidifiers, water coolers, and heat pumps, saw its turnover fall from £17.7 million in 2023 to £15.9 million in 2024. Directors described the period as "another challenging year."
In response, the business made a decisive move at the end of 2024, closing a production line dedicated to loss-making products. This strategic closure resulted in substantial one-off costs, including a write-down of fixed assets worth £1,038,363 and stock valued at £814,898. These additional provisions totalled £1.8 million in closure costs.
Consequently, the firm's operating losses, including these exceptional items, widened dramatically from £1.5 million to £4.1 million. The overall pre-tax loss for the year grew from £2.5 million to £4.9 million.
Management's Optimistic Outlook for 2025 and Beyond
Despite the bleak figures for 2024, the company's founder and chairman, John Elliott, signed off an accounts report expressing strong confidence in the future. The report stated that the closure would make future years more profitable.
"We expect only a small loss in 2025," the directors wrote. "In addition, cash flows will be enhanced in 2025 and beyond." They highlighted that no further cash injections from shareholders were needed in 2025 and that the business maintained adequate cash reserves.
The report also noted that 2025 sales had recovered to 2023 levels after a temporary 10% dip in 2024, primarily due to lower demand for water coolers. The average number of employees fell from 188 to 157 during the year.
New Products and Leadership Driving Recovery
Ebac's path to recovery is being paved by investment in new products and a refreshed management team. The company has been focusing on its range of domestic heat pumps designed for the average UK home.
Following the end of the 2024 period, during 2025, the firm successfully built relationships with distributors for these new heat pumps and its loft-mounted dehumidifiers. A new range of dehumidifiers was also launched last year.
A new management team was recruited in 2025, including a new chief financial officer. Directors believe these appointments "will have a significantly favourable impact upon future revenues and profitability."
With the restructuring complete and a renewed focus on innovative products like heat pumps, the directors are now convinced the business is in a "much stronger position" and are concentrating on rebuilding. They forecast much stronger trading figures in 2026 and beyond.
