Strategic priorities

Kingfisher Lighting, celebrating five years of Group ownership, enjoyed an outstanding year in 2022 and clearly illustrates the Group’s growth strategy.

When Kingfisher was acquired for £9.8m in 2017, it was a good business with significant potential. Not only did the business hold established positions within the attractive UK exterior lighting market, it also represented an excellent cultural fit, with clear values and an excellent reputation with its customers. We saw that, with access to our advantaged business model, we could create synergies that would further enhance this business.

The hard work over the course of the last five years was borne out in 2022, with the business generating revenue of £17.7m and operating profit of £2.3m, an increase of 46% and 92% respectively since acquisition. The business is now generating a Return on Capital Invested approaching 20%.

Top-line revenue growth has come from multiple sources. Existing customers now see the business as their preferred external lighting supplier due to innovative new products created through the Kingfisher Lighting and Luceco design teams working side-by-side. Furthermore, the business has been able to expand its Sports and High Mast divisions. Supported by the Luceco-developed “Amnis” product range, sales of £4m were generated within these markets in 2022, a ten-fold increase from 2018.

Importantly, Luceco have invested for the long term, with staffing numbers carefully increased from 70 to 90 since acquisition. These additional team members have enabled growth whilst still maintaining excellent service levels. Furthermore, our existing in-house IT and HR support have improved Kingfisher’s supporting infrastructure and reliability. Our additional investment and back-office support leave the business well positioned for the future.

Costs have also been reduced where appropriate. In 2018 Kingfisher had 12 significant suppliers, which has now been reduced to five with Luceco’s own in-house facilities contributing to product manufacturing. Product development processes have been streamlined and now the business is able to move from concept to launch more efficiently.

The future looks set to offer further opportunities, which we are excited to be in a position to capture as a result of our knowledge gained with Kingfisher Lighting. This experience in developing and manufacturing larger luminaires leaves us well positioned to do the same with DW Windsor. Furthermore, the combined portfolios of Kingfisher Lighting and DW Windsor presents the opportunity to create a complementary product offering for a wider customer base.

We have a long history of leading change within our industry, consistently producing products with enhanced functionality and cutting-edge designs.

Our innovative culture spans our entire product range. Within Wiring Accessories, we were the first in the UK market to add USB functionality to mains sockets, whilst our LED Lighting products provide the consumer with both energy savings and superior lighting levels. Our drive for innovation remains a key part of our strategy as it not only differentiates our products from the competition, but it also enables us to up-sell what we manufacture to maintain consistently high margins. Through focus groups, social media interactions and feedback gathered via our sales teams, we are launching new products that meet the contractor’s desire for quality, value for money and ease of installation.

This ongoing design philosophy is particularly evident through the launch of our new highly competitive range of BG Sync EV chargers. The 7.2kW chargers are perfectly designed for home use that is convenient, safe and reliable.

We have designed an internet-enabled device that offers functionality that is convenient to the end user, such as charge scheduling and monitoring via a smartphone. We have also focused on the needs of the installer by offering free training seminars and online installation videos.

Designed with safety and ease of installation in mind, the range is amongst the safest on the market, with built‑in current overload and grid fault protection.

The range is being made in-house and at scale by our team in China, which gives us a cost and product availability advantage in a rapidly growing market. We are encouraged by the results of our first full year in this new market, where we have sold 14,200 units in total, equivalent to 4% penetration of plug-in vehicles sold in the year.

Looking forward into 2023, we are excited by the planned launch of our next generation of EV chargers, which will include a 22kW version for faster charging in a commercial setting to further enhance our product range.

Our investment within the industry we operate in illustrates how we look to the future to ensure we sustain our competitive advantage within our chosen markets and contribute to society’s sustainability goals.

Long-term growth within our industry is underpinned by the constant evolution of electrical regulations. The UK’s wiring regulations are updated on average once every two years. Updates are largely focused on improving safety features, which increase the value of the products we sell and shortens the product replacement cycle, increasing demand.

We have provided electrical contractors with access to free resources to train them on the latest wiring regulations in the UK, thereby supporting the development of our industry and investing in our brand image. We have held over 100 training seminars nationwide this year, hosted in conjunction with our major professional wholesale customers. Digital training hosted on our Luceco Academy website, our professional development portal for UK electricians, was consumed by nearly 10,000 contractors in 2022.

To help further professional development within the industry we have become the headline sponsor of the prestigious eFIXX 30 under 30 awards, aimed at recognising up-and-coming talent within the electrical industry and to showcase work from the next generation of electrical contractors. We were proud to announce 2022’s successful winners, recognising individuals who are willing to go the extra mile and deliver outstanding service and results.

One of those crowned a worthy winner was Alexander Sime, founder of Neo Electrical Solutions, who showed his gratitude for Luceco Group and explained what it meant to have the Group’s support:

“Having such industry heavyweights like Luceco Group sponsor these awards and individual categories, in my opinion, really adds another level to the eFIXX 30 under 30 awards. To be accepting an award presented by representatives of manufacturers that we regularly use on some of our projects and to be recognised by some of the biggest in the industry is a great feeling.”

We are also working with industry leaders to drive change and contribute to society’s sustainability goals. During the year we were proud to announce our collaboration with the latest clean electricity campaign from the Electrical Contractors Association (“ECA”), “Leading the Charge”.

Our support for ‘Leading the Charge’ and eFIXX’s 30 under 30 awards are both integral parts of our Sustain strategy, encouraging both students and apprentices to become brand ambassadors, and advance Luceco’s work towards a cleaner, sustainable world.