10th Jun 2015 08:30
LONDON (Alliance News) - Castings PLC Wednesday reported lower profit and revenue for its last financial year as both its businesses manufactured lower volumes, but it said it is now experiencing improved demand from many of its customers and expects profits to rise this year as long as the recovery continues.
The iron castings and machining group which sells into the automotive market amongst others, reported a pretax profit of GBP17.5 million for the year to end-March, down from GBP21.8 million a year before, as revenue fell to GBP131.3 million from GBP137.5 million.
Despite this, it increased its final dividend to 10.08 pence, bringing the total for the year to 13.30p, up from 12.96p.
It said casting output declined 8.5% in its foundry business, after the introduction of new European engine emissions rules had boosted demand for its products in the previous year.
Castings also said that the work mix at its William Lee foundry business has increased in complexity and it has moved to harmonise production methods across the group in response.
"The new senior management team at William Lee have addressed the production issues that arose and good progress has been made. I am confident that the William Lee foundry will return to greater profitability under the new team," Castings Chairman Brian Cooke said.
The company said production at machining business CNC Sppedwell also fell from the high level of the previous year, meaning a small drop in profit.
"It is pleasing to report a higher proportion of revenue from external customers following our decision to increase machining of alternative materials with a wider customer base. The group has invested GBP3.9 million in the machining business to support the new orders that have been generated," the company said.
"In general we are now experiencing improved volumes from many of our customers and it is anticipated profits will increase providing the recovery continues," the company said iof its overall business in its outlook statement.
Castings shares were up 1.3% at 410.00 pence Wednesday morning.
By Steve McGrath; [email protected]; @stevemcgrath1
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