British eyewear specialist Inspecs faced a challenging year in 2022, reporting a slight dip in group revenue to $246 million compared to $246.5 million in the previous year. However, the company stated that these figures were in line with their revised expectations. The revenue for Inspecs’ existing business saw a decline of 12.9% to $233.4 million, while its acquisitions experienced a 12.4% increase, reaching $12.6 million.

Despite the overall decline in revenue, there was positive news for Inspecs when considering constant exchange rates. The company’s revenue actually grew from $246.5 million to $270 million, indicating a 9.5% growth. This growth can be attributed to Inspecs’ global operations, particularly in Asia, where its factories managed to maintain production despite supply chain disruptions and Covid-19 restrictions. Interestingly, China’s production volume even increased in 2022 despite these challenges.

Inspecs’ subsidiary, Norville, also showed signs of improvement. The losses narrowed in the fourth quarter, and the company made further progress. Notably, its R&D department, Skunk Works, generated its first commercial income. Inspecs expects to benefit from Norville’s efforts in terms of operational efficiencies in 2023.

Inspecs is renowned for manufacturing and marketing its own eyewear brands, as well as holding eyewear licenses for various fashion brands such as Viktor & Rolf, Barbour, Liberty, Henri-Lloyd, Superdry, Radley, Temperley, and Ted Baker. The company experienced a decrease in order flow in the third quarter, particularly in the German, French, and other European markets, resulting in a sales reduction in the fourth quarter. To address this issue, Inspecs initiated a cost reduction program aimed at enhancing operational efficiency in 2023. However, its performance in other markets aligned with management expectations.

Despite the challenges faced, Inspecs maintained a strong group order book. As of December 31, 2022, the group’s order book stood at $41.9 million, only slightly lower than the $42 million from the previous year. Inspecs identified several headwinds in 2022, including significant decreases in the euro against the US dollar, which had a considerable impact on its European business. In addition, freight costs reached record highs, and material, product, and operating costs all rose significantly.

Inspecs has actively implemented cost-cutting measures at Norville, aiming to streamline the business and drive revenue growth. The company plans to continue seeking operational efficiencies and cost reductions where appropriate while executing its growth strategy. It also intends to commence construction of new manufacturing facilities in the second half of 2023, using funds generated from free cash flow. Inspecs remains confident that it will enhance value for all stakeholders as it enters the year with a robust order book.

Useful Links:
1. Inspecs Official Website
2. Inspecs Eyewear Brands