Greenworks Solutions cuts losses and expects return to profit after buying coffee machine firm Zeebrook

An office drinks supplier expects to return to profit next year after selling its water cooler business and snapping up a coffee machine firm.

Greenworks Solutions cut its operating losses on continuing operations by 98% to nearly £40,000 after it offloaded its water division to Angel Springs for £5.7 million in September 2015.

The Edenbridge-based firm more than doubled sales on continuing operations to £12.9 million thanks in large part to the takeover of refreshments firm Zepbrook a month later, which had annual turnover of about £6 million.

Coffee poured from an office machine. Stock picture
Coffee poured from an office machine. Stock picture

The company said its washroom division, which supplies items like soap dispensers, “continues to make a significant and growing contribution to profit”.

Pre-tax losses on continuing operations shrank by 95% to £91,000 from £1.9 million in the year to the end of September 2016.

The firm, which employs about 130 people, had made an overall pre-tax profit of £7.9 million a year earlier, thanks to the water sale to Angel Springs, which has a depot in Marden.

In his company report, director Adam Warren said: “The water business had been subject to a degree of price competition for a number of years, and Greenworks had offered only point-of-use coolers, which has put us at a competitive disadvantage in recent years, with customers wanting the choice of point-os-use and bottled coolers.

"The sale of the water business to Angel Springs in September 2015 has allowed us to invest significantly in the coffee business, which offers both serviced coffee machines and sale of coffee, tea and ancillary products, and this has shown very high growth..." - Adam Warren, Greenworks Solutions

“The sale of the water business to Angel Springs in September 2015 has allowed us to invest significantly in the coffee business, which offers both serviced coffee machines and sale of coffee, tea and ancillary products, and this has shown very high growth.

“Losses are associated with high investment in to the growth of the business, which will become profitable within the next 18 months.”

The company said more than 90% of its revenues are contract based. Its retention rate is 92%.

Mr Warren added that washrooms and coffee both grew significantly.

He said: “The acquisition of Zepbrook, where no single customer represents more than 2% of turnover, with a very high re-order level from a widely spread customer base, has reduced risk.”

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