It was exactly a year ago today that renewed restrictions took effect in Scotland to curb the spread of the Omicron variant of Covid, with physical distancing again enforced indoors, the return of limits on crowd sizes, and the closure of nightclubs. Given all that has happened in the intervening 12 months, it seems a more distant memory than is actually the case.
Concerns about the virus have largely been replaced by the crippling impact of the cost-of-everything crisis that firmly kept the economy in check even as health restrictions lifted. Russia’s invasion of Ukraine undermined global political stability and super-charged inflationary pressures. Three prime ministers and four chancellors passed through the UK’s revolving door of government.
Still in recovery mode from the pandemic, businesses did their best to navigate a truly remarkable set of hurdles. As ever, some fared better than others, be it through good fortune, market circumstances or astute management – or often a combination of all three.
Good Year
Hurricane Energy
The Shetland oil pioneer experienced a remarkable recovery in its fortunes this year, having come close to being taken over by bond holders in June 2021.
Like all oil and gas producers, Hurricane has been the beneficiary of the dramatic increase in wholesale prices that began as the global economy emerged from lockdown, and gained renewed impetus after Russia attacked Ukraine. After returning to an $18 million profit in 2021, the company made further progress during the six months to the end of June, declaring itself debt-free as it posted a pre-tax profit of $67m, up from $42.8m a year earlier.
Hurricane put itself up for sale last month after receiving a takeover proposal that it rejected as too low. Its largest shareholder, Crystal Amber Fund, last week called for the removal of Hurricane’s management team in “the continuing absence of a firm offer” that reflects the value the business.
Loganair
Glasgow-based Loganair returned to profitability in 2022, having successfully navigated nearly two years of travel restrictions that brought the global airline industry to a standstill.
Following the collapse of Flybe in March 2020, Loganair expanded beyond its traditional Scottish heartlands to become the UK’s largest regional airline with a fleet of 42 aircraft operating across more than 70 scheduled routes within the UK and to Ireland, Denmark and Norway. It has a long-running partnership with British Airways, and has more recently signed agreements to provide connecting flights on behalf of Singapore Airlines, Finnair and Ethiopian Airlines.
Jonathan Hinkles, chief executive of Loganair (Image: Loganair)
After two successive years of losses, Loganair made a pre-tax profit of £5m during the 12 months to the end of March – its 60th year in operation – on revenues of £161.7m. The company announced in October that its owners, brothers Stephen and Peter Bond, are looking to sell the business so they may retire, having been involved in the business for 25 years.
Barrhead Travel
Earlier this month Barrhead announced the launch of a new flagship store in Glasgow’s Gordon Street, which is expected to open in February. That follows the recent move to the group’s new £1m headquarters in St Vincent Place.
Like most in the sector, Barrhead has benefitted from the tourism industry’s continued resurgence from the pandemic. With more than 80 stores and in excess of 500 staff in the spring of this year, the company has been hiring throughout 2022 with a particular focus on apprenticeships for younger people.
Manorview Group
The Scottish hospitality group returned to the acquisition trail earlier this year in a bid to strengthen its business following the challenges of the pandemic.
Manorview employs 560 people across 11 venues in Scotland such as Boclair House in Bearsden, Brisbane House in Largs, The Redhurst in Giffnock, and The Torrance in East Kilbride, as well as bars and restaurants including The Lowland at Lynnhurst Hotel in Johnstone and The Commercial in Wishaw. Headquartered in Renfrewshire, the group is headed by managing director David Tracey.
Bad year
M&Co
Founded in Paisley in 1961, Scottish fashion retailer M&Co became the victim of the profound upheaval taking place on the high street as it fell into administration just two weeks before Christmas.
The firm employs more than 1,900 staff across 170 stores throughout the UK. There were no immediate redundancies as administrators Teneo Financial Advisory are looking to potentially sell the business.
M&Co went into administration two weeks before Christmas (Image: Newsquest)
“Like many retailers, the company has experienced a sharp rise in its input costs, which has coincided with a decline in consumer confidence leading to trading challenges,” joint administrator Gavin Park said.
“Despite a very loyal customer base, particularly in local markets, and a well-recognised brand, the current economic outlook has placed increasing pressure on the Company’s cash position.”
Loch Duart
The salmon producer said in July that it has been repeatedly forced to turn away business as it grapples with acute labour shortages that have beset Scotland’s food and drink sector in the wake of Brexit.
The news further underlined the crippling problems faced by food manufacturers after an estimated 1.3 million people from overseas left the UK during the pandemic. Industry leaders say post-Brexit immigration policy has made it all but impossible to replace those lost workers.
Loch Duart, which has salmon farms in Sutherland and the Outer Hebrides, spent £2m on a complete refurbishment of its processing facility in Dingwall in 2020. The 50,000sq ft plant produces 6,000 tonnes of salmon annually, but production director Russell Leslie said there is capacity for “much more”.
“In the last 12 months, due to staffing, we have had to turn down multiple opportunities to process other fish producers’ fish, [and] we’ve also had to stall our own new product development resulting in missed opportunities in the marketplace,” he said.
Scottish National Investment Bank
Launched in November 2020 with a £2 billion war chest to invest in Scottish companies meeting the government’s “key missions” to improve sustainability, inequality and innovation, the state-backed lender posted a loss of more than £3m in its maiden accounts filed in October.
While this is to be expected from a start-up in the early-stage investment sector, the bank sparked controversy in February when its first chief executive, Eilidh Mactaggart, departed abruptly. Ms Mactaggart, who had been in post for less than two years, cited “personal reasons” for her exit several weeks later.
Parsley Box
Following a tough ride after joining the Alternative Investment Market (AIM) in March 2021, Edinburgh-based Parsley Box has continued to struggle.
The group announced in September that it had reduced its headcount by nearly a third as it grapples with a decline in online shopping volumes amid the cost-of-living crisis.
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