Princess Yachts has announced a record-breaking year in 2017 with the best sales record in its 53-year history, a robust return to profitability and advanced orders worth more than $1 billion. Financial results for the 12 months to 31 December 2017 show record turnover of £274.4 million (+26.6 per cent on 2016) and an Operating Profit before Exceptionals of £7.9m (2.9 per cent of sales), representing a turnaround of £15 million (6.1% points) on its 2016 results and continuing the trend of strong year-on-year growth for the L Catterton-owned UK luxury yacht builder. To support this growth, Princess has also increased its workforce by over 500 team members in the last year.
Princess’ success has been shared across its size ranges. “By our figures, we are the market leaders in small yachts in the 30-50ft and 70-95ft size ranges and as those segments continue to grow it benefits our superyacht sales,” starts Antony Sheriff, executive chairman of Princess Yachts. “We have a lot of objective data that shows our customers regularly change boats and, with a 90 per cent propensity, they will upgrade to a larger boat. We now have a lot of mid-sized and large boat customers looking to enter the superyacht market with an incredible amount of loyalty. Our sales of superyachts have also been bolstered by the new products we have launched recently.”
Sheriff explains that Princess has implemented an enormously successful strategy for its smaller vessels that is reflected in its superyacht market. Princess does not build stock boats, it will only build for a buyer. “If you produce stock vessels, you may sell a lot, but it is hard to determine how profitable they will be,” Sheriff explains. “The only area that we have struggled with is that our robust order book has meant that our delivery times are delayed, with some orders running into 2020.”
The robust order book, however, has also created a healthy resale market for Princess customers that are wishing to change vessel. “Because of our new order book, the residual value of our pre-owned vessels is increasingly, which is exactly what you want as a customer. When you come to buying your next boat, it's reassuring to know that you can sell your current one and get a good price for it,” says Sheriff.
"One thing we have noticed is that the bigger the vessels get, the more the skill set that is required of your workforce changes," Sheriff continues. "Could we build a 50m superyacht? Yes. Has it been in our past product plan? Yes. Is it in our current product plan? No." The current focus of the brand is to stick to its specialisation, which is producing world-leading boats in the smaller size categories.
The information provided in the slider is a snapshot from The Superyacht Annual Report 2018: New Build. Based on cumulative LOA over the last five years, Princess ranks 12th globally, this position set to improve in the coming years, expect the British superyacht manufacturer to break in to the top 10 soon. Click here to get your copy of The Superyacht Annual Report 2018: New Build.
Gallery: A graph to show Princess' five-year delivery performance in the 30m+ sector (source: The Superyacht Intelligence Agency).
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