Dyson, the privately owned British engineering group famous for its vacuum cleaners and bladeless fans, has announced record-breaking profits of £367m, up 13% on the year, despite spending £3m a week on research and development.
Max Conze, the company’s German-born chief executive, said Dyson’s ownership structure had helped it keep its investment in new technology at high levels. “We’re playing a long game for the future. One needs to have some appetite for risk,” said Conze.
“Sometimes you have to take a punt when developing new technology. James [Dyson] spent 15 years developing the first bagless vacuum cleaner and he showed no signs of giving up.”
He points to the success of cordless vacuum cleaners, for which sales were up 68% in 2014, as testament to the success of the Dyson ownership model – the entire company is owned by founder Sir James Dyson and his family.
“James took a punt on the cordless vacuum cleaner about 18 years ago, without a team, without a hell of a lot of money. Sometimes you have to take a punt and then spend 15 years and then you’re better off being in a family-driven setup, where the family is the guardian of that technology and engineering focus.”
Cordless vacuum cleaners, which can be used for just 20 minutes before needing a recharge, now outsell traditional machines by three to one in Japan and by four to one in China.
The other product category to shine in 2014 was environmental control, where the Dyson Humidifier became the top-selling humidifier in Japan by value.
Geographically, Conze said the group took the number one spot in Germany in terms of sales and maintained its position as market leader in Japan. It doubled the size of its China business, despite the country’s economic slowdown. “I see China as being one of our largest markets,” he said. “The recent stock market movements haven’t affected consumer attitudes yet.”
During the year, Dyson acquired Jake Dyson Lighting, a business started by James Dyson’s son, which specialises in trendy LED lamps starting at £400. The acquisition puts Dyson Jr in pole position to succeed his father. “James is very excited to see what Jake is doing,” said Conze. “Jake and his team have lots of ideas about how to disrupt the lighting sector.”
Dyson said its profits, although up 13%, were held back by a strong pound. Turnover was up 10% at £1.38bn and investment in research and development rose £80m to £113m.
Conze said the company wanted more skilled foreign graduates, educated at British universities, to be allowed to stay in the UK. “Some of the brightest minds in the world have been educated at the best universities in the world in the UK. We need to keep the smart kids here,” he said. “There are 300 engineering positions open. We constantly need more engineers.”
The company’s charitable trust, the James Dyson Foundation, donated £20m to Imperial College London and the University of Cambridge in 2014.
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