Sense of direction

Cornwall Group has had to adapt to the Covid-19 challenge but remains focused on its objectives including acquisition and a £multi-million investment.

Like everyone else, Mark Mitchell, chairman of Cornwall Group, and the new directors of the Cornwall Group, didn’t have the ‘slightest inclination’ of what was looming on the horizon.

Covid-19 made the Cornwall Group’s first 12 months as a ‘group’ memorable, according to Mark.

“The rug was pulled a little from under our feet,” he said.

“We restructured for a number of different reasons. Cornwall Glass had grown from a family business to become something far bigger. The way we were structured meant we couldn’t bring the levels of focus to the business in the way that we wanted to.

“Mackenzies [Glass] had shown me how effective a small agile board accountable for a single business could be. And wanted to replicate that across the rest of the business.”

Mackenzie Glass was acquired by Cornwall Glass in 2017 from Pilkington/NSG. Pilkington’s first ‘regional partner’, Mackenzies offering is weighted towards the float glass company’s ranges. It nonetheless remains independent of it, also holding product in stock from Saint Gobain, Guardian, AGC and, most recently, Pyroguard.

Under the leadership of joint managing directors Mark Herbert and Matt Prowse (and with Mark on the board), it returned to profit in 2019, just two years on from acquisition.

“As a small team of directors I could see how effective we could be, not only in driving increased efficiency within our business but improving service levels to our customers,” Mark said. “I wanted to roll that out across what was Cornwall Glass.”

A restructure of Cornwall Glass divided its operations across two new divisions (Cornwall Glass Manufacturing and Cornwall Glass and Glazing), with Mackenzie Glass making up a third and new group merchanting division.

Each a limited company in their own right, they sit under a new group function – encompassing IT, finance, marketing, health and safety, and HR support – the Cornwall Group.

“We reached our year end in June,” Mark said. “Pre-Covid-19, we were heading I believe towards a very positive outcome. Covid-19 has clearly impacted on that; March, April and May are always key months, and we’ve in effect lost a complete quarter out of the year. But the model has worked.”

Cornwall Glass Manufacturing, the Cornwall Group’s trade supply business, is fully geared to high volume IGU fabrication, with three manufacturing facilities in St Austell, Highbridge and Plymouth.

Plymouth is geared towards the manufacture of over-sized IGUs with its Bystronic line capable of handling units of up to 2.7m x 5m.

“Those smaller boards have brought new focus to the business, particularly in our manufacturing business where the three sites and the teams within them are working more closely together, providing a wider range of products, more effective distribution, and a better service to our customers,” Mark said.

Mark suggests that consolidation in the glass sector – a trend already apparent, pre-Covid-19 – will continue through this year and into next.

“This includes not only perhaps some smaller manufacturers but also national manufacturers who may be inclined to step back from some of their downstream activities,” he said.

“There may also be a thinning out of large IGU companies. Those companies require a lot of work to feed them.

“We’re not looking to be one of the biggest players in the market. Our focus is primarily the south and the west of England but we do intend to be one of the strongest and we will look to exploit opportunities for future growth as they arise.”

This he says, has included exploratory talks with three potential acquisitions during and since lockdown, which he adds had reached a ‘meaningful stage’.

“They may come to nothing, I don’t know, but we remain an acquisitive company,” he said.

While through Mackenzie Glass, Cornwall Group has a strong relationship with Pilkington, as highlighted, it also has partnerships in place with Saint Gobain, Guardian, AGC and Pyroguard.

In not putting all of its eggs in one basket, the Cornwall Group chairman said that its manufacturing businesses had been able to mitigate the impact of shortages.

“We have some very robust negotiations with our suppliers but we do so from a position of mutual respect and the basis of genuine partnership,” Mark said.

“The industry is clearly experiencing significant issues in supply. In purchasing float glass from a number of different suppliers rather than a single one, we are able to manage our supply chain effectively and in turn protect our customers from the worst of the disruption that the market is now seeing.”

If Cornwall Group is keeping its eye out for potential purchases, it is also planning to invest, with £5 million earmarked for infrastructure and machinery investments in its first three years in existence.

“When we created the group, we did so with a plan for investment,” Mark said. “That includes new sites but also the extension of existing sites and new machinery.

“Some of those projects have been pushed back slightly because of Covid-19 related delay, but all are still moving forward. We don’t intend to drop anything. They will continue slightly later this year and into 2021.

“We remain acquisitive and remain, as a group, committed to investing £4-5 million in the next two to three years.”

Watch the interview here: