A Manchester-based push bike company is laying off employees and closing its headquarters after losing over £4 million.
Insync Bikes has announced restructuring measures after claiming that the UK market had a “huge erosion” of demand in 2022.
The company also wants a £3 million capital injection from its Indian parent business, Hero Cycles, by the end of March next year.
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According to newly filed records with Companies House, the company made a pre-tax loss of £3.7 million for the fiscal year ending March 31, 2022, compared to a loss of £769,822 the previous year.
The Trafford Park company also made a pre-tax loss of £4 million in the fiscal year ending March 31, 2020, and last made a profit on January 31, 2015.
The statistics came after the company announced ambitions in May 2022 to double its UK market share to 20 percent by 2024 after moving to a new 60,000 sq ft headquarters at Centenary Link.
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On its latest set of accounts, a statement signed off by the board said: “Post Covid-19 pandemic global supply chains presented some challenges.
“The company was able to procure stocks. This diluted any material impact on the sales throughout this period, unlike many organisations who suffered greatly in 2021.
“Sales were flat during the year as markets saw a return to normalcy.
“2022 saw the group incurring losses on account of high upstream and downstream inventories across bards and channels.
“This has resulted in serious margin erosion coupled with socio-economic factors.
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“The group continues to receive unwavering support from the group, with £4.85m of equity being introduced by Hero Cycles during the financial period under review.”
On its future, the company added: “The directors are focused on returning the group to profits. The aim was to capitalise on the substantial improvement in performance during 20/21.
“However the difficulties referred to above have somewhat slowed down this trajectory.
“Despite these challenges, there are substantial new business relationships being forged, all of which are currently live and trading, albeit in their infancy as we speak but regardless still substantial.
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“There is much more to follow on these fronts and we hope to see the benefits of this hard work in months and years to follow.
“Great strides have also been made into securing higher value, more premium product lines, with e-bikes being a huge part of this positive step forward for the group. This will drive both revenue and contribution moving forward.”
The company added “due to UK bike markets experiencing huge erosion in demand during 2022, the operations of the group need to restructured to ensure that the group operates in profit and as a going concern”.
Source: Business Live
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