The Aga saga: Sales of the classic cookers are hotting up again

After a tricky recession the iconic iron range company is preparing itself for a comeback, reports Sarah Arnott

Upper middle class families may well be tucking into their freshly-baked bread with renewed gusto this morning, buoyed by the news that Aga Rangemaster – the company whuich makes the icon of the English country kitchen – appears to have weathered the downturn and is heading for a profit this year after all.

The past two years have been a rough trot for the half-tonne, cast iron cooker-cum-radiator beloved by a string of famous names from the Prince of Wales to Janet Street Porter and Cristiano Ronaldo. It is all very well having a clientele so loyal they swap stories on dedicated websites, such as agacentral.com, but recession is a particularly difficult time to sell a product that costs an average of £7,500 to buy and install and has average running costs of another £1,000 per year.

It is not just consumer confidence that has been the problem. With 70 per cent of Aga sales made within 12 months of a customer moving house, the downward trajectory at the manufacturer, Aga Rangemaster, very much followed that of the property market. Like housing, Aga Rangemaster peaked in 2007 with turnover approaching £300m as sales of Agas hit 76,000 and those of the company's other iron cooking ranges came in just below 20,000.

But as the credit crunch put the brakes on mortgage lending and property deals started to dry up, so too did sales of Agas. Since 2008, cast iron cooker sales have dropped by a quarter, and those of traditional Agas by about 15 per cent. The company's stock also collapsed, dropping by a shocking 25 per cent on a single day in November 2008, The shares now trade at about 130p, a far cry from their 810p price at the end of 2006.

In a scramble to reduce costs, the company shed about 400 jobs – or 20 per cent of its workforce. It also slashed inventory levels by more than £10m, about 20 per cent, leaving factories operating on extended shutdowns and shorter shifts. The nadir came in the first half of 2009. Aga Rangemaster's sales dropped by 19 per cent, its pre-tax losses came in at £2.4m compared with profits of £12.3m in the first half of 2008, and it was forced to scrap its dividend.

But the worst may finally be over. Trading has improved sufficiently since the autumn to put last year's sales ahead of those in 2008. The company is even predicting it will make a profit for the year to March. "As it was for most companies, 2009 was a pretty tough year, but we had a good run towards the end," said the Aga Rangemaster chief executive, William McGrath. Despite Aga sales slumping by 12 per cent in the first half, sufficient ground was made up over the past few months to put it back in the black for the whole year.

Mr McGrath is confident that the steady improvement in the housing market will continue, and that the company's efforts to save cash – now back up to £25m from a worrying £2.3m in the middle of last year – and focus on new products will pay off.

Aga Rangemaster is also actively looking into expansion overseas. At the moment, one third of the group's sales are outside the UK but the aim is to get up to that figure up to half. Europe has already proved a major growth area. In 2009, sales in France totalled £6m – 10 per cent more than in the previous year and up from nothing just four years ago.

But there are even bigger threats than recession rumbling in the background. For all the passionate support from the Aga fan club, there is a growing anti-Aga lobby which claims the cookers are, at best, an anachronism and, at worst, an environmental outrage. There are even overtones of a "class war", with critics claiming that the Aga symbolises the hypocrisy of well-heeled people who ignorantly guzzle the world's resources as their Labradors snuggle up to cookers that are designed always to be on.

The company is trying hard to hold its own in the climate change debate, despite critics' claims that building an Aga releases as much carbon dioxide as the production of two cars, and that running the thing emits as much carbon per year as an ordinary home.

One of Aga Rangemaster's initiatives is to enable owners of older Aga models to upgrade their burner systems with the latest programmable versions, which can be set both to drop to a low-energy, dormant mode, or to turn off completely.

Given that the majority of Agas last several decades, if not generations, the company hopes the move will also provide it with repeat business as well as addressing virulent criticism from environmental activists. "People may be very familiar with the product but not necessarily with the company," Mr McGrath said.

The plan is also to turn apparent weaknesses into environmental strengths. Proponents have always argued that an Aga is the centre of a family home, with a key role in the provision of heating and hot water, not just cooking. Now the company hopes the advent of micro-generation will make its product the heart of a 21st-century domestic energy system.

Micro-generation from wind or solar power raises questions about how to store the energy, but Mr McGrath believes Aga has the answer. "One interesting feature of the Aga is the need for small amounts of power over a long period, so it could act as a battery in the home," he said. "We are not quite there yet, technologically, but that is where we are going."

Chapter one: The blind inventor

The Aga cooker has become an emblem of a rural Englishness and even spawned its own literary genre: the "Aga sagas" set in large country houses where the iconic, half-tonne ranges are stereotypically found.

Although they are now made in Britain, the Aga was designed by a Swede. The original cast-iron, multi-oven Aga was invented by Dr Gustaf Dalén, a Swedish scientist who won the Nobel prize for physics in 1912. While confined to his home after losing his sight in an acetylene gas explosion, Dr Dalé*came up with the Aga concept as a way to help his wife.

"His big idea was that cooking was a physics problem about the allocation of heat," said the chief executive of Aga Rangemaster, William McGrath.

The Aga – which takes its name from the Aktiebolaget Gasaccumulator company that first produced it – made its debut in the UK in 1929. By the Second World War they were no longer produced in Sweden at all, but were well on their way to becoming what is now a quirky British institution.

A significant increase in sales came in the 1960s when the original, coal-burning Aga was modified. Oil-burning models came first, followed by gas. In the early 1980s the Aga went electric, and now 65 per cent of new cookers sold use a normal 13-amp plug.

Even the manufacture of an Aga is quintessentially British. They are made at the world heritage site of Coalbrookdale in Shropshire, where Abraham Darby smelted iron ore with coke to make cooking pots in the early 18th century, thereby helping to kickstart the industrial revolution.

Whether because of it popularity, or its enormous size, the Aga has considerable staying power. A recent survey found several cookers that were still working after for more than a generation, and one which had been used by the same family since the 1920s.

Over the decades since Aga production began in the UK , the company has been through several incarnations. The original Allied Iron Founders became Glynwed, which then sold most of its metals business to a Belgian competitor in 2001. The remaining company, Aga Food Services reinvented itself again, in 2007, selling off all businesses not specialising in cast-iron to the Italians for £265m.