Caravan firm warns of tough time

Owners of a caravan dealership in Staffordshire have warned of tough times ahead for the business.

Discover Leisure bought the Brownhills Caravan Group, in Wolverhampton Road, Cannock in March for over £2 million.

The company has warned it is facing a challenging time due to the poor economic conditions. The group said its first half results were in line with expectations with a pre-tax loss of £1.8m for the six months to the end of February, widening from £788,000 the previous year, with turnover up to £51.8m from £10.1m.

But the company which employs 30 workers at its Cannock branch, said the outlook for the second six months, in which it generates the majority of its sales, is more uncertain.

It said the normal seasonal uplift was depressed by an early Easter and worse than average weather which led to lower than expected results in March and April.

Discover Leisure said it estimated the value of the UK caravan, motor home and camping sector to be more than £1.6 billion a year and the outdoor clothing and equipment market was worth £1.2bn.

The company said sales of caravans had increased six per cent to February but there was evidence of a decline but sales of motorhomes has seen an upward trend.

Trevor Parker, chief executive of Discover Leisure, said: "I am very pleased that we have been able to produce results in line with expectations for the first half year."

He added: "Delivering expected results in the final quarter will be a challenge in the predicted economic conditions but we are confident that the strengthening Discover brand and market leading levels of customer service will help us to maximise results in both this and future years."

Buying the Cannock branch in March was Discover's first toe-hold in the West Midlands.