Weaker sales hit Bifold’s bottom line

BIFOLD Group, the Middleton-based manufacturer of valves for the oil & gas industry, witnessed a 10% drop in sales in in the year to August 29, 2010, to £19.8m.

Pre-tax losses at the firm widened to more than £2m (2009: £848,270 loss) as a result of a 38% drop in operating profits. Notes to the accounts state that ths was a result of higher levels of investment in R&D, manufacturing equipment, infrastructure and transaction systems which “will enable the group to take full advantage of the expected improvement in market conditions”.

Bifold Group is led by chief executive Gary Jacobson, who led an initial buyout of the company from founder Mike Draper in 2002. In 2007, it underwent a secondary buy-out backed by Bank of Scotland’s now defunct combined debt and equity arm, Integrated Finance, which funded a £35m secondary buy-out that left Jacobson and members of his management team with a majority stake in the company.

It also created a considerable debt burden for the company to contend with, though.

The company owes more than £31m in long-term debt Bank of Scotland’s new parent, Lloyds Banking Group, and by the year end its total liabilities outweighed its assets by £2.7m.