Stamford Group slims down with sell-offs
PLASTICS manufacturer Stamford Group has refocused on its domestic and European markets after selling its successful US business.
Annual accounts filed by the Staylbridge group, which makes a range of products from medical storage containers – it owns the leading Medstor brand – to retail shelving, reveals that it also exited its petrol stations business and tackled its final salary pension fund deficit.
The disposals mean that the slimmed-down group will have annual sales of around £15m. The petrol stations business, Bishop Retail, which was sold last November had sales of £27.6m and the US subsidiary, Opto International Inc £18.3m.
Profits in the year to the end of September 2011 surged ftom £1.7m to £3.3m – thanks mostly to a large, one-off contract in the US.
Chairman Frank Stafford said the US arm had achieved “exceptional results” with profits of $8.1m. He explained: “Those results are due to large sales to one new customer, which would not repeat in the short term.”
The Chicago-based US business was sold “in order to generate funds for shareholders” and while he did not reveal the proceeds, said it had brought in “significant amount of cash and interest-bearing loans” from the new owners, which includes some former senior managers.
He said the decision taken last year to sell the petrol stations business was “clearly the correct one” given that it saw a “large” fall in volumes due to high fuel prices.
Results in the UK were described as “very poor” as the business was hit by a double whammy of a government spending squeeze in the health sector and higher raw material costs causing losses in the basic plastic mouldings business as customers refused to buy at higher sales prices.
In reference to the issue relating to the problematic pensions scheme, Mr Stafford said the entire £3.5m deficit had been paid off last October, and then the board had bought out the scheme by selling it to an insurance company.
“The buy-out cost is expected to be £2m but that will stop any futher losses to the group in supporting the scheme.”
