Sheffield Forgemasters has succeeded in cutting debt and continuing to invest, despite operating profits halving as the global economic recession continued to affect its business.
The company reduced debt by a third from £12.9 million to £8.4m and raised investment from £2.6m to £2.9m.
Operating profit fell from £5.4m to £2.3 on turnover reduced from £106.8m to £100.1m, for the last financial year.
Despite this, Forgemasters remains upbeat about prospects for the current year and highly optimistic about winning major contracts in a number of different markets.
Chairman, and current Master Cutler, Tony Pedder, said: “This is undoubtedly a long period of recession, with major recovery seemingly still some way in the future.
“However, we continue to do all we can to contain our costs, to maximise our market reach and to exploit the skills and technical excellence which is the company’s hallmark. Effective working capital and cashflow management has enabled a significant reduction in debt and is a credit to all concerned.
“Export has been our lifeblood for many years, and thankfully so, as major capital project opportunities in the UK remain disappointingly limited.”
Mr Pedder said markets have remained largely subdued and the signs of economic recovery that have started to emerge in many global sectors have yet to spread significantly to major capital investment projects, which are the bedrock of Forgemasters’ business.
“The exception has again been the offshore sector, where our skills and efforts have remained strongly focused, to encouraging effect.
“Given this background and the resultant pressure on margins as competition for available orders has been intense, it is pleasing to report that turnover has held up,” said Mr Pedder, before going on to repeat earlier warnings of the effect that rising energy prices and uncertainty over future supplies were having on local businesses like Forgemasters.