600 Group sees improvement

MACHINE tool manufacturer 600 Group is waiting for its unwelcome
suitor Precision Technologies Group (PTG) to put up or shut up on a
takever bid.

The Leeds-based company rejected an approach from PTG last month
but its private equity-owned rival, which includes machine tool
makers Holroyd, Rochdale, and Jones and Shipman Precision,
Leicester said it was “considering its position”.

600 Group has criticised PTG, which is owned by London-based
Venture Private Equity (VPE) and Ferranti Capital, for its
“lack of clarity” which it said is “unhelpful”
and has welcomed a Takeover Panel-imposed deadline of 5pm on
November 29 for PTG to make an offer.

Today 600 Group reported strength in its UK and European markets
but “softness” in the United States. However the company
believes that the weak dollar will see American manufacturers
reversiing outsourcing decisions and investing in new equipment as
they decide to manufacture at home rather than buy in from
abroad.

600 Group, which is headed by former Yorkshire Group chief
execurtive Andrew Dick, saw sales for the six months to September
29 increase by 10 per cent to £41m, from £37m last
time.

Gross profit margins increased to 31 per cent and operating
profit before financial income and tax was £600,000 compared
to a £500,000 last year.

Pre-tax profits increased to £1.6m thanks to an increase in
net financial income to £1.1m, which was due to the non-cash
impact of the UK pension scheme.

Earnings per share for continuing operations was 1.9p, compared
to 0.3p for the same time last year.

Chief executive Andrew Dick said: “The continued investment
in and introduction of new products across all the group's
businesses combined with improved sales, marketing and distribution
networks has been reflected in the results achieved over the last
18 months. Notwithstanding the current financial climate the board
is confident that the group will make further positive progress in
the second half of the year.”