Business

Sales at Chain Reaction Cycles down after currency moves

Chain Reaction Cycles was acquired by Wiggle in July for £73m

BALLYCLARE retailer Chain Reaction Cycles (CRC) saw sales fall 11 per cent last year due in the main to the strength of sterling.

The firm, which sells bikes and accessories to more than 160 countries, recorded turnover of £136.4 million in 2015.

The figures cover Chain Reaction's last full set of annual accounts before it was acquired by former British rival Wiggle.

Wiggle - which reported £178.3m turnover in the 48 weeks to January 3 - paid £73m for Chain Reaction in July.

In their business review filed with annual accounts, CRC directors said: "With more than half of the group's sales being earned outside of the UK, the strength of sterling during 2015 has had a significant drag effect on sales."

Profits after tax more than halved to £1.2m from £3.8m in 2014.

The company reduced staff figures over the year to 517 on average (against 540).

Chain Reaction started as a small family-run shop in 1984 before growing into the world's largest online bike shop over the three decades that followed.

The newly combined Wiggle and CRC Group refinanced its banking facilities with HSBC in July with an additional £15m credit facility.

In their last set of separate company accounts, Wiggle chief executive Stefan Barden said sales in 2016 had been “strong” and had increased since the Brexit vote and subsequent weakening of the pound.

Turnover and profits are expected to increase this year.

Chain Reaction Cycles started as Ballynure Cycles in 1984 by George and Janice Watson with a bank loan of £1,500.

Within five years, they rebranded the firm Chain Reaction Cycles and in 1998 changed the focus to mail order.

The online offering was launched in 2000 and after significant growth, the firm opened its own 50,000 sq ft warehouse in 2005 and followed this up with a 10,000 sq ft flagship retail premises in Belfast in 2011.

Wiggle, which also sells running and swimming gear, was founded in 1999 as a sister firm to Portsmouth bike shop Butlers Cycles.

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