Inditherm positive despite tough market conditions
GLOBAL recessionary pressures have knocked Inditherm’s sales in the first half causing the Rotherham-based firm to post a loss.
Inditherm, which supplies heating systems for football pitches and mattresses for premature babies and operating tables, reported a pre-tax loss of £635,000 for the six months ended June 30 compared to a £22,000 profit for the same period 2008.
Turnover excluding sales to US distributor Smiths Medical fell by 32% to £555,000 from £811,000 the year before.
Sales for non-medical market sectors of the business fell by 53%. However, orders for medical products showed an underlying growth rate of 5%.
Ian Smith, Inditherm’s finance director said that although the growth rate was down from a previous 40% high it was still positive.
He told TheBusinessDesk.com that the recession had affected capital expenditure of the firm’s clients although only one project had been cancelled.
“Decision making has been extended, which makes things difficult for us,” he added.
“But positively most projects have not been cancelled just delayed.”
Mr Smith said that the firm was now focusing its marketing activities on the NHS by offering a range of payment options and highlighting cost savings as a result of purchasing Inditherm’s systems.
“We need to get our medical business back up and we believe as more pressure falls on the NHS to make cost savings we will benefit. Choosing our systems is not a difficult decision.”
Inditherm is also continuing its efforts to break into the US and last year took on an independent distributor in addition to Smiths Medical after it failed to make sales.
“We are confident there are significant opportunities for our product ranges but progress to date has been below our expectations and further hindered by the market conditions in the USA,” it said.
“We are actively supporting our American distributors in every way possible, and they remain confident that the cost-saving benefits of our technology will result in progress, particularly in the operating room market.”
The firm also has new products aimed at the food and industrial sectors.
Commenting on the outlook Mark Abrahams chairman of Inditherm, said: “Trading in the second half of 2009 has, so far, followed a similar pattern to that experienced in the first half. The peak summer months are traditionally the quieter period for all areas of the business so we are unclear at this stage how long these market conditions will continue.”
“The company is pushing hard to maximise sales, with emphasis on the Medical sector, as we drive the business towards break-even, but anticipate continuing to make a loss in the second half of the year.”
