H1 profits rise for Goodwin despite oil & gas woes
STOKE-on-Trent engineering group Goodwin has seen an improvement in first half revenue and profits despite the decline in the oil & gas sector.
The company said it had made a pre-tax profit for the six months to October 31, 2014 of £13,450,000 (2013: £12,280,000), an increase of 9.5% from a revenue of £72,970,000.
It said time would tell whether it could find alternative business to offset that lost through the oil & gas decline.
Chairman John Goodwin said: “We have in the first half of this new year seen a continued fall off of activity in the oil and gas industry associated with lower oil barrel prices and the reduced investment by the major oil and gas companies.
“We started this new financial year with a record work load of £101m, but this has steadily been decreasing as the order input fell behind our sales output.
This decreasing workload will make it likely that the performance in the second half of this financial year and next year will not be as good as the first half of this financial year.
“Time will tell whether we can find satisfactory levels of work to fill the gap temporarily caused by the slowdown in the oil and gas industry which we think will be quieter for a couple of years.”
He said even though it was declining, the group still had a good order book backlog in most of its companies.
It said its investment in additional machinery in Goodwin International was starting to provide benefits and was allowing the business to diversify into markets other than oil and gas such as the UK defence industry. The Refractory Division both in the UK and in its six overseas plants has continued to grow revenue and profits, which it said was likely to continue to grow in the coming years.
“Our commitment remains to invest in engineering, be it mechanical or refractory, where we strive to supply technically advanced products to growth markets,” added Goodwin.
“By the financial year end, just prior to the UK elections, we hope to win more project engineering business for both the foundry and machine shop from both civil markets and UK defence markets that will allow us to take advantage of our recent substantial investment in large CNC machine tools.”
The first half also saw the company acquire its Indian partners’ 20% equity in Goodwin Pumps India and Gold Star Powders India. These two subsidiaries are now 100% owned by Goodwin.
