North East builders' merchant James Burrell saw turnover increase 34% to £91.6m and operating profits more than double in what it calls an "exceptional" year.
The Gateshead based firm - which employs about 260 people - said it had enjoyed a thriving construction sector and predicted turnover may even surpass £100m in 2022 as it reported sales growth and broadly sustained margins in its latest set of accounts.
And now the business has invested £4.5m in its 11th store in Billingham, which is under construction and due to be opened in August and £1.5m in a fleet of new vehicles.
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Writing in a report accompanying accounts for the year ended October 31, 2021, managing director Mark Richardson said the consequences of Brexit were not all negative for the business.
He said: "Construction has been a sector that has been encouraged to continue and to drive forward the country's desire to 'build back stronger' and has experienced somewhat of a tail-wind since.
"This has created some unprecedented challenges in the shape of significant price increases across most building product groups, demand out-stripping supply for many commodity products creating supply chain pressure and a buoyant housing market that has just registered double digits price growth and is experiencing exceptionally strong demand when there was already a shortage of new house builds being registered.
"Forecasting for the year ahead remains very tricky in this climate. The latest guidance from the Department for BEIS in its latest update from Dec 2021 indicates that GDP is forecast to grow at 4.7% in 2022 and 2.1% in 2023. Specific to construction, the bounce back is not expected to abate, with all construction sectors anticipating growth in 2022 and 2023, with infrastructure being the main driver.
"Supply chain issues are likely to remain in play throughout most of 2022 and with the Bank of England increasing interest rates from 0.1% to 0.25% in December and further increases likely to follow in 2022, these factors could dampen demand in 2022. However, it is likely that growth will just fall in line with more sensible levels than experienced over the last year and overall construction output growth is forecast to be very similar to GDP, touching marginally higher at 4.8% throughout 2022."
Mr Richardson said the directors' decision to take low dividends meant value was being reinvested back into branches and that was contributing to ongoing strong business performance together with debt reductions - resulting in an improved gearing position.
Stock turnover was said to have increased but remained lower than 2019. The firm said there had been a deliberate focus to negate any potential Brexit impact and global supply chain shortages and disruption to increase the value of stock held across its branches - meaning it had the right materials at the right time for customers.
Mr Richardson added: “The last two years have been a real team effort. As a multi-generational family owned and managed business, our priorities have been the health and safety of our staff, customers and suppliers.
"Our industry has been challenged by the impacts of Covid, the constant pressure of supply chain disruption and significant price increases. Despite these we have found a way to maintain a strong service-based growth within the business”.
