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600 Group ‘mindful’ of economic impact
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24/10/2008
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The machine tools manufacturing and marketing specialist 600 Group told shareholders today that it was “mindful that demand for our products will be impacted by the current global financial and economic conditions”.
At the company’s annual meeting, group chairman Martin Temple (pictured) said order intake activity over the first half of the year continued at a similar overall level to last year with the Continental European and South African markets offsetting the relative softness in the UK and North America.
“Overall sales in the first half of the current year were at a similar level to the first half of last year, although this prior period included the benefit of a £4.5 million contract with a major aerospace company. Our outstanding order book, after adjusting for the impact of this major contract, is marginally lower than at this point last year,” he went on.
“Despite the challenging market, our operating margins over the first half remained in line with our expectations, with increases in raw material prices being offset by selling price increases and strict cost controls.
“The Company has completed the previously highlighted programme of 70 redundancies at a total cost of £0.9 million. This exercise included the closure of our sales operations in the Czech Republic, Singapore and Malaysia, at a cost of £0.3 million. Sales activity in these areas has been transferred to other 600 Group facilities.
“Whilst we are continuing to invest in sales, distribution, product design and development, we are mindful that demand for our products will be impacted by the current global financial and economic conditions and opportunities for further cost savings and working capital improvements will be strong areas of focus during the second half.”
New group chief executive David Norman had conducted a full review of the company's operations and will be implementing the detailed findings from this review over the coming months.
Looking forward, Temple said the company would continue to implement its strategy in all its major markets while achieving operational efficiencies and improvements.
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Author
Ken Hurst
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