Senator hit by restructuring costs

SENATOR International, a family-owned firm which designs, manufactures and supplies office and other commercial furniture, has revealed a sharp fall in profits.

The Accrington-based company, which employs more than 1,000 people, was hit by an exceptional item of £932,000 as a result of its move to relocate Teal Furniture – a High Wycombe-based healthcare furniture firm it bought in 2008 – to the North West.

Even without this hit, Senator’s 2010 profits were down in what director Robert Mustoe – son of founder and chairman Colin   – described as “another
difficult trading year.”

Sales, impacted by the continuing weakness of the commercial property market fell 6.3% from £98.4m in 2009 to £92.2m.

Operating profits fell from £2.4m to £1.9m, while pre-tax profits, including the one-off item, fell from £2m to £552,000.

In his review of the year Robert Mustoe says the results were ‘satisfactory’ given the market conditions. While acknowledging the fall in sales he said a decline in the gross profit rate seen in 2009 had been reversed, and was 26.1% compared with 25.9%.

Also on a positive note, he pointed to a strong second-half performance US-based subsidiary Senator Inc, which in the year grew sales to £6.6m.

Mr Mustoe said the reorganisation within the healthcare division should lead to “significant” savings in the future.

He said the group’s financial position remains “exceptionally good” and pledged further investment in new products.

“In the present economic climate the directors will continue to review the group’s operations and cost base, whilst at the same time continuing to improve the product range, market share and profitability.

“In particular it (the board) will continue its policy of investing for the future in product research and development in order to maintain its position as an innovator and main independent UK supplier of office furniture and explore options to reduce manufacturing costs in order to maintain competitive prices and margins.”