Buoyant export market for listed manufacturing firm delivers boost in profits
Doncaster manufacturer MS International has reported a pre-tax profit rise as it has strengthened its export market and adapted to changing market conditions.
The listed firm, which has divisions including petrol station superstructures, defence and forgings, this morning published its results for the year ending 28 April 2018, stating pre-tax profits increased to £4.04m (2017 – £1.53m) on revenues of £68.09m (2017 – £53.82m).
Chairman Michael Bell said the business had a long established policy to constantly review capabilities, and if necessary adjust and adapt. He said: “This serves us well by ensuring we are aligned to changing market conditions and demands.
“Our diversified operating structure can deliver significant advantages when trading conditions are varied across totally different sectors.”
He said its defence division made a good start towards a recovery in revenue and profitably as a result of a buoyant export market, although the domestic market remains restrained and subdued. Export sales accounted for the major component of the division’s revenue, which it said was in response to new product offerings and investment in research and development.
Bell added: “The domestic market, by comparison, has remained constrained by the UK’s tight budget controls which result in inevitable delays to programmes and, in consequence, a market that lacks any reasonable element of clarity.”
In the forgings division, revenue increased and is breaking even at the trading level while losses, incurred as a consequence of developing a new manufacturing facility in the United States, have been reduced. Bell said that the firm’s plants in the UK and Brazil continued to hold good market positions.
Its petrol station superstructures and petrol station branding divisions both traded in a “significantly changing international market” said Bell.
The superstructures division experienced a check to its growth pattern owing to a notable change in the market it principally serves. Bell said: “Until relatively recently, many of the division’s major customers had been global oil companies but they have accelerated the divestment of their company owned petrol filling station estates, with ownership passing to both large and small independent dealer/retailers.
“Accordingly, construction of new sites and the refurbishment and expansion of existing facilities are passing through a state of limbo as numerous sale and purchase transactions continue to dominate the attention of the sector’s active participants.”
However, the branding is further advanced in this process of transformation. Bell said: “When ownership of stations changes the incumbent fuel supplier may also be changed and that in turn initiates re-branding of the station. The operational performance of this division is adjusting to the changing market which was lead initially by Germany, then The Netherlands and is now happening in the UK.”
Bell added: “We perceive that, with a sustained measure of prudence, we are continuing to move the business forward on an upward trajectory and are well positioned to support and develop opportunities for the Group.”
