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Harman Technology Limited financial performance 2005-2016

Oren Grad

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Feb 17, 2005
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I've created the attached mini-chartbook based on data in the Harman Technology annual reports filed with Companies House UK. The data extend back to the origin of Harman Technology in the Ilford bankruptcy and reorganization of 2004-2005 and continue through 2016. The report for 2017 hasn't been filed yet.
 

Attachments

  • Harman Technology Limited Financial Performance 2005-2016 20180406.pdf
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Thanks Oren, that's fascinating. I'm not sure what to make of it just yet, but the R&D expenditures toward the right are a bit surprising to me, and I do hope they increase when the new figures are available.
 
Amazing how private companies in the UK are compelled to give out such information.
 
Very, very interesting.

It shows profit plummets after 2005 (but stays more or less stable), however, R&D staff is increased from about 2007 on, and the number of R&D staff in 2012 is apparently double the 2005 R&D staff. I think this is interesting and encouraging. From the top of my mind, about 2005-2006 were the last years pro photographers were still using film primarily.

I'm glad to see they never diminished they expenditures in R&D; and it's even more surprising considering that thay already have quite evolved, stable, (may I say perfected?) products like Delta 100, FP4+, and HP5+. Moreover, i wouldn't be surprised if 70% of Ilford's B&W sales are purely HP5 !
 
flavio81 said:
...however, R&D staff is increased from about 2007 on, and the number of R&D staff in 2012 is apparently double the 2005 R&D staff. I think this is interesting and encouraging.
Click to expand...

Any increase in R&D staff would be due to attempts finding alternative use for silver halide and other Harman related technologies.
I followed Harman all the years and found their figures not promising. More so as we have seen what happened to Ilford Imaging.
 
Be careful in interpreting the R&D time series.

First, it's a composite series. The numbers from 2005-2011 come from a single item in the annual reports, a subcategory of administrative expenses labeled "research and development". For 2012-2015 the categories were rearranged, and the number in the chart represents the sum of "research and development staff salaries' plus "research & development charged as an expense". For 2016, R&D staff salaries are no longer separated from other staff categories, so it's no longer possible to construct the sum.

Second, R&D covers all R&D at Harman, including any research and development conducted in an effort to diversify away from photographic products. It is impossible to tell how much of the number represents R&D on photographic products.

Also, I wouldn't put much weight on the comparison between 2005 and later years. 2005 represents the 16-month period from Sept 2004 when the Ilford bankruptcy and reorganization were concluded and Harman Technology was launched. That was a very bumpy transition, and there may be various one-off accounting items or special circumstances included in that year.
 
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Both companies share a lot:
the same technology, similar facilities, similar size, similar or overlapping markets and similar owners.
 
AgX said:
Both companies share a lot:
the same technology, similar facilities, similar size, similar or overlapping markets and similar owners.
Click to expand...

Same technology? No.
Similar facilities? No. Even if true, irrelevant.
Size? Irrelevant.
Overlapping markets? Nope.
Similar owners? What does that even mean?
 
R&D in non-photographic areas isn't inherently bad. Profits from non-photographic products and services can help amortize fixed and administrative costs; allowing a company to continue to support film. And, personally, I'd like to see film-oriented R&D focused on reducing the cost, increasing flexibility, and maintaining quality of production rather than new products. The objective would not be to reduce prices (though I would not mind that) but to maintain profitability of film production.
 
RattyMouse said:
Same technology? No.
Similar facilities? No. Even if true, irrelevant.
Size? Irrelevant.
Overlapping markets? Nope.
Similar owners? What does that even mean?
Click to expand...

You seem not to know the industry.
 
AgX said:
Both companies share a lot:
the same technology, similar facilities, similar size, similar or overlapping markets and similar owners.
Click to expand...

they did many years ago... and several ownerships.

quoting from the Site of Ilford Imaging:
"2005
ILFORD Imaging UK are subject to a management buyout, which results in the formation of HARMAN technology Ltd in February 2005. HARMAN continue to use the ILFORD name for traditional black and white products.

In July 2005 Oji Paper, a 130-year old company based in Tokyo, bought ILFORD Imaging Group's Swiss operations which It produces inkjet products and high quality colour photographic products under the name ILFORD Imaging Switzerland GmbH and includes the GALERIE and Printasia ranges."

HARMAN technology Ltd has not had anything to do with Ilford imaging since that time, other than having a licence to use the ILFORD trademark for BLACK & WHITE Materials. Hence the HARMON line of Ink jet materials.
 
Thanks for running the numbers and producing the charts, Oren. This is interesting.

How many employees are there in Ilford’s R&D department anyway? If one guy retires and isn’t replaced, or is replaced by a junior employee with a much lower salary, would that explain the change in expense, or does it reflect some real change in direction and outlook?
 
Looks like they are managing losses well enough to stay afloat as long as possible.
 
Charles, you are sad enough ill-informed too. You better not inform about one company at its competitor...
 

Indeed, it's a little hard to read the exact numbers off the chart, so here's the time series for R&D staff count:

2005 - 12
2006 - 12
2007 - 12
2008 - 14
2009 - 18
2010 - 18
2011 - 19
2012 - 23
2013 - 24
2014 - 23
2015 - 23
2016 - 19

We don't know how much turnover of inidividuals there has been within those numbers.
 
Also, a reminder: the turnover numbers are not exclusively for analog photographic products. Harman has two other lines of business: inkjet photo papers, and silver-based antimicrobial technology. The latter is marketed as a capability to develop customized antimicrobial products specific to a client's application.

I see two big take-homes.

First, the company has stayed on a more or less even keel through some fairly turbulent years primarily by continuing to cut costs.

Second, the company is now small - very small. I would guess - and I emphasize that this is my guess, there is NO information in the annual reports on this - that among the analog products, sales are probably dominated by 35mm HP5 Plus and by Multigrade IV RC Deluxe in the more common sizes. In financial terms all of the other SKUs are probably, in the grand scheme of things, vanishingly small niche products. But even if I'm wrong about which products are the biggest sellers, overall turnover is so low and the number of distinct SKUs that Ilford continues to offer so large that by simple arithmetic, sales of most of them individually must be very small.
 
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Now you are on a better track.
(And the Agfa-Orwo-AgfaPhoto saga is full of demons...)
 
Oren Grad said:
...and the number of distinct SKUs that Ilford continues to offer so large...
Click to expand...

To make that concrete, I just went through the Ilford Photo website and did a tally. Considering both film and paper I found a total of 51 separate coatings offered - by separate coatings I mean distinct combinations of emulsion and base that require a separate run of the coating machine. There are also 27 different darkroom chemicals, 6 different scientific specialty plates/emulsions, and at least 10 other miscellaneous products that require distinct manufacturing or procurement runs.

The number of SKUs that have to be warehoused and accounted for is a multiple of this because of all of the different product sizes that are cut from the master rolls of film and paper, and also different package sizes for some of the chemicals.
 
But offering such a variety is a both a blessing and burdon for a manufacturer. The burdon is obvious. The bargain is that a customer may be inclined to choose them just because they offer same or similar emulsion in various tastes and thus stays with them.

A manufacturer has to find out about such bargains and then make up their calculation.
 
RattyMouse said:
Amazing how private companies in the UK are compelled to give out such information.
Click to expand...
Amazing that the USA permits artificial creations of statute (corporations) to keep secret their financials.
Sadly, so does Canada.
 
Thanks for the additional info, Oren.
 
MattKing said:
Amazing that the USA permits artificial creations of statute (corporations) to keep secret their financials.
Sadly, so does Canada.
Click to expand...

Amazing that the USA permits individuals to keep secret their financials. Simply amazing.
 
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