Metalrax loses Morrisons contract

ALVECHURCH-based manufacturing group Metalrax saw its shares dip by 9.5% in early trading this morning as shareholders reacted unfavourably to the announcement that it had lost a key contract with supermarket giant Morrisons.

The contract – with the firm’s consumer durables division – represents 3% of Metalrax’s annual group revenue.

In March Metalrax revealed an annual turnover figure of £63m which would mean the Morrisons contract was worth around £1.9m.

The firm – a niche supplier of both specialist engineering and consumer durable products – was informed by Morrisons that it wouldn’t be renewing its supply agreement for bakeware from Metalrax subsidiary George Wilkinson, based in Burnley, Lancashire.

However, George Wilkinson will continue to supply certain seasonal bakeware to Morrisons.

Metalrax chief executive Andrew Richardson said:  “We are obviously disappointed to have lost this significant customer, which we tried very hard to keep.

“We will now concentrate our efforts on replacing the volume lost with new business whilst maximising our capacity utilisation.”

Metalrax recently reported mixed fortunes in trading activity in the half year to July 26.

The firm said export sales have continued to perform well in its specialist engineering division but the consumer durables division has continued to face “very challenging trading conditions”, particularly within the High Street retail and grocery sectors, reflecting the general economic situation within the UK consumer marketplace.