Historic textile company Low & Bonar was declared by its chairman to be “a nimbler, tighter, customer focused organisation.”
The firm founded in Dundee more than a century ago reported a 10.5% rise in turnover at £400 million in the year to November 2016. Profit before tax, amortisation and non-recurring items was up 6.6% at £29.2m.
With a much reduced presence in the city of its birth, the group has moved from being production-led to a market-focussed, global performance materials business.
It now employs only 50 staff in its carpet-backing manufacturing plant at the Caldrum Works, with the bulk of operations in plants throughout Europe, North America, the Middle East and China.
In describing the group’s transformation, chairman Martin Flower said Low & Bonar is making good progress towards most targets.
Without the issues in Coated Technical Textiles, he said Low & Bonar would be very close to a double digit operating margin.
Profits at Coated Technical Textiles were 37.9% lower due largely to manufacturing issues in the first half of the year which had been largely resolved.
Sales and profit growth was strong in Building & Industrial and Interiors & Transportation, and profit and margin improved in Civil Engineering.
The disposal of artificial grass yarns for £22.75m to the Mattex Group of Dubai – in a move that cost 30 jobs in Dundee – had streamlined the group’s focus.
There was continued investment in assets to support growth, with capital investment of £22.2m in 2016 after £33.7m in 2015.
As well as operations in China, Hungary and Slovakia, a company in Seattle had been bought to strengthen the group’s profile in the US building products market.
Mr Flower believed market conditions in Europe will remain challenging but Low & Bonar was well positioned.
“We expect that North American markets will remain supportive and China will continue to develop,” he stated.
“We have a clear strategy to enhance returns and will continue to focus on active portfolio management and investing in growth opportunities.”
Chief executive Brett Simpson said the Dundee operation continues to make a positive contribution to the bottom line.
He added: “Dundee is where it all started but the group wants it to be more entrepreneurial to find new markets.”
