Some time ago I standardised on just three films for much of my work. For silver-gelatine fine printing on 120 format for contrasty situations, I use Ilford HP5+ in combination with Ilford’s Perceptol in various dilutions. For soft light I use FP4. For street work, exclusively in 35 mm format, I use Ilford XP2 Super. I do not print street work, it being destined for on-line presentation, and therefore XP2 seems such a good option. It scans well, has a wide exposure latitude, enables multiple ISOs on the same roll and is compatible with Digital ICE. For printing I use Ilford FB warm-tone and cool-tone papers. You can say that I am heavily invested in Ilford.
So, a recent invite to a focus group at Ilford’s head-office and factory in Mobberley seemed all the more pointed following Agfa’s withdrawal from the black and white market and Fuji’s recent announcement that its Acros film would be discontinued. We film photographers worry about the ever diminishing availability of film. I was genuinely interested in seeing the factory processes but I was also keen to gauge what state the business was in. Once a corporate auditor, always a corporate auditor! Over a long career I have been on hundreds of factory assessment tours all over the world.
Ever since Harman was acquired by the Pemberstone Group (a private equity investor) in 2015 there has been much speculation over its future, in particular whether there is a property game in play. Over a long career, I have learned to ignore speculation. It always seems to be wrong.
No-one would deny that the factory has significant over-capacity, an ageing workforce, a large and under-utilised site. The position on the remaining lease term is unclear. The most recent available accounts (2016) show growth in overall sales (due to film sales we are told) and respectable if unspectacular profits. Capital investment is low and significant, I think, is the fact that profits are flattered by the low depreciation as a result of assets having already been written down. Against this though, maintenance costs are probably high as the kit is old and difficult to source because it is so specialist.
You could say that the accounts show the typical profile of a business that is ‘in abeyance’. Pemberstone’s acquisition was nearly three years ago now, and no announcements of any major initiative as yet. For me, one thing is clear. Input cost pressures will continue to mount, and given that further process efficiency is unlikely to offset these without further investment, decisions will need to be made. It’s unlikely that the business will be able to pass on increased costs to customers through increased prices. The products are price-inelastic, as economists are fond of saying. A further issue is that the biggest market is the US and hence sales in sterling depend on the dollar rate. Although hedged, cash-flows could be hit by adverse movements.
Is this outlook overly gloomy? I would like to think so but it depends on how real and sustained is the pick up in film sales and the way in which this increase is demographically distributed. ‘Old Timers’ (like me) are dying off. How much of the increase relates to Old Timers who have got sick of the expense of continuously upgrading digital kit? How many of the young film photographers repeat buy and for how long? If other companies, Kodak in particular, start to close film manufacturing the short-term outlook for Ilford may turn out to be difficult. Ilford films tend to be cheaper than Kodak’s, and hence tend to be used by student photographers, the key target population. If film (any film) becomes harder to source, then this could act against Ilford until such time as distribution channels were expanded. I am not a believer in the ‘last man standing’ argument. Sales need to continue to expand, particularly given the fact that the company is financed through an invoice discounting facility. The 2017 accounts will be interesting.
All of this is fairly obvious, of course. I want Ilford to succeed, as I have a vested interest. But there is another reason. The people that I met during my tour were open, friendly, passionate about Ilford and really nice people. I would like Ilford to succeed for them. Let’s hope sales continue to grow. I will continue to do my bit!