Tighter margins squeeze profits at European Metals
EUROPEAN Metals Recycling (EMR), the Warrington-based scrap metals processing giant owned by the Sheppard family, increased sales by 22% last year to £3.38bn.
But a mixed picture across its global markets squeezed gross margins, from 18% to 14%, impacting pre-tax profits which fell by 25% to £115.9m.
The firm described the global economy as “unsettled” in 2011 with disparities across the world, ranging from European pessimism on the back of the euro crisis to cautious optimism in the US, and continued growth in Asia.
EMR has bases in the UK, US, Holland and Germany and has shipping capabilities in each country which mean it can move metal anywhere in the world. It has continued to invest, making a number of bolt-on acquisitions in the US, and in September 2011 it bought a 51% interest in EMR Gold Recycling, a business based in Texas.
“Significant investments continue to be made in new technology to enhance the recovery of metals and reduce the impact of waste from the group’s activities,” the directors said in their report.
The group has a £420m, multi-currency revolving credit facility with a syndicate of international banks which was extended by two years to 2016 in March.
The business has a total of 2,448 staff, with 1,484 of them in the UK. During the year the number of people working overseas for the group grew by 230.
In August chairman Philip Sheppard died. In their report the directors said they were saddened by the death of Mr Sheppard, describing him as an “exceptional entrepreneur and businessman”.
