Brunner Mond’s £30m investment fillip
NORTH West chemicals group Brunner Mond is bullish over prospects for this year, despite the slump in demand in two key sectors which it supplies.
The historic Cheshire company, founded in 1873 in Northwich – which has remained in its home town, says it is better-prepared than ever to fight the recession, and has nearly £30m of new investment coming on stream or beginning this year.
Chief executive John Kerrigan, 59, said, the company, which employs around 450 people across two sites in Northwich, is recruiting for staff this year and has no plans for redundancies.
The investment – £18m on an energy efficiency programme and £10m on a new production facility – comes after a strong 2008, which saw record production levels and a strong financial performance.
Accounts just released for the 12 months to March 31 show the UK business made profits of £10.7m on turnover of £126.5m.
In the previous 15 months the UK business made a £11m profit on turnover of £147.5m.
Brunner Mond’s core business for many years has been the manufacture of the chemical sodium carbonate – known as soda ash – which is a key ingredient in the glass making process.
It is in this area, where demand is weakening as a result of the slump in new housebuilding and also the decline in new car sales.
More recently it has expanded into manufacturing sodium bicarbonate, which has a host of uses in the environmental, medical, food and farming sectors. A new £10m sodium bicarbonate plant is beginning production in April.
Mr Kerrigan, who has been with Brunner Mond for 31 years, said: “We are a more robust and diversified business than before.”
“Around 10 years ago we were a one shop Johnny, but we have been and are continuing to develop the bicarbonate business, which has a number of recession proof applications . We will continue to eat, continue to need indigestion remedies (sodium bicarbonate is used to give products like AlkaSelzer a fizz), and there is a growing demand in flue gas treatment too.”
Sodium bicarbonate, an alkali, is becoming increasingly used by businesses comply with new environmental legislation by to neutralising acidic flue gases produced during manufacturing. Brunner Mond’s has developed a bespoke product, Briskarb, for the flue gas market.
Brunner Mond is a subsidiary of Tata, the giant Indian conglomerate, and according to Mr Kerrigan is flourishing under its long-term investment strategy.
“Prior to Tata taking over we were owned by venture capitalists. Tata is playing a long-term game with all its acquisitions, and they are being very supportive in building the business and improving its performance,” he said.
Looking at the economic outlook for 2009, Mr Kerrigan said he was expecting sales to be dented by falling demand from the automotive and housebuilding sectors, but said there was a “huge challenge” presented to exporters as a result of the fall in the value of Sterling.
