Factory closure and redundancy costs hit manufacturer’s profits
THE £4m costs of the planned closure of a factory in the North East affected the financial results at Wavin, but its underlying performance demonstrated a positive pipeline.
Pre-tax profits nearly halved to £5.9m in 2014 at plumbing parts maker Wavin, although the previous year’s figures benefitted from pension gains of £9.1m.
Sales increased 13%, growing £21m to £181.2m, helped by the broader improvement in construction and house building. Wavin makes pipe systems which it both sells and installs, with its customers including plumbing merchants, housing developers and utility companies.
Stripping out the effects of the redundancy costs and pension gains, the company improved its operating position from a £500,000 loss to a £7.9m profit.
Alan Nicholls, Wavin’s managing director said: “This restoration to a more profitable, sustainable business has led to the decision for further significant investment in the business.”
It has expanded its facilities at Doncaster, where the company is headquartered, and Chippenham, Wiltshire, although this is partly through consolidating activities as a result of the closure of the factory in Brandon, near Durham, which is currently being phased out.
Wavin said the company’s performance had “significantly improved further” during the first half of 2015 and expects its full-year performance would show a “further significant increase” in trading profitability.