The OT Group, headquartered in Greater Manchester, faces financial setbacks amidst changing work trends, leading to its decision to leave the UK market.
- A pre-tax loss of £52.5 million was reported for 2023, which followed a previous loss of £15.8 million in 2022.
- Turnover for the group dropped from £120.8m to £109.8m over the fiscal year, reflecting reduced market demand.
- The company announced its plan to sell UK and Ireland operations due to prolonged difficult trading conditions.
- Changes in work practices and low office occupancy rates are key factors influencing OT Group’s strategic decision.
The OT Group, including Office Depot and Spicers, reported a significant pre-tax loss of £52.5 million for 2023. This marks a considerable increase from the £15.8 million loss recorded in 2022. This financial decline comes in the wake of evolving work environments and practices, primarily driven by a long-term trend towards remote working.
Turnover for the group saw a notable decrease, falling from £120.8 million to £109.8 million over the fiscal year. The last recorded pre-tax profit for the group was in 2020, at £10.1 million, with subsequent losses of £5.3 million in 2021, highlighting a concerning downward trend in financial performance.
The strategic decision to exit the UK and Ireland markets was publicly announced in August, citing a “sustained period of difficult trading conditions.” This move reflects the company’s critical evaluation of its operations, aimed at mitigating ongoing financial challenges.
The workforce within the group has been reduced from 553 to 529, underscoring the company’s efforts to streamline operations amid adverse market conditions. The board’s statement emphasized that the company has completed a comprehensive review of its UK and Irish market operations.
The statement further noted that the demand for general office supplies remains low due to the prevalence of remote work and reduced office occupancy rates. The outlook for increasing office occupancy remains bleak, prompting the group to conclude that the current oversupply in UK’s office supplies market is untenable.
The decision to exit the UK market reflects OT Group’s response to challenging business conditions and shifts in work practices.
