A firm whose products are found in Big Ben’s clock tower and the Thames Barrier has delivered some positive news from the UK manufacturing sector after returning to half-year profit for the first time in two years.
Manchester-headquartered Renold, which makes heavy duty chains, notched up pre-tax profits of £400,000 in the six months to 30 September, compared to losses of £8.8 million in the same period the previous year.
It also reported sales up 23% to £92.9 million, as it turned in a half-year performance that exceeded management expectations, helped by improving market conditions.
About 10% of its 2,000 staff are employed in Bredbury, near Stockport, where they assemble industrial chain used in a wide variety of industries around the world, such as mining, transport, factory conveyor belts and oil production.
Renold is benefiting from an increase in orders from companies that were ‘destocking’ during the recession in a bid to cut costs. Orders exceeded sales for five of the last six months, it said.
The company’s chain manufacturing business, which accounts for 76% of its sales, returned to profit in the half-year after underlying turnover was boosted 31% by strong demand from India, China and America.
The rest of its business – which makes products including gearboxes and carriage couplings used on New York Subway trains – suffered a dip in sales in the half-year, but increased its operating profits after focusing on higher margin products.
Renold delivered a further boost to the UK economy by announcing it would close a site in Seclin near Calais, which employs around 20 people, and relocate the work to its plant in Bredbury.
The outlook for the rest of the year remains positive and it will consider paying a dividend in the following year.
The company’s other factories are scattered across the world in locations such as Einbeck in Germany, Tennessee in America, Tamil Nadu in India and Hangzhou in China.