Samuel Heath & Sons PLC reported a fall in pretax profit with labour shortages and machinery replacements causing disruptions.
The Birmingham-based shower and bathroom accessory manufacturer said that pretax profit in its year ended March 31 had fallen to £1.1 million from £2.0 million the prior year.
The company said profit margins were reduced due to the replacements required for machinery breakdowns and maintenance, with some computer numerical control lathes coming to their end of their capacities. Labour shortages also caused delays and inefficiencies, and energy costs increased by £366,000 year-on-year.
Revenue was up 5.0% to £14.7 million, from £14.0 million the previous year.
‘As anticipated in the half year report, the second half proved to be more difficult than the first half, with tightening market conditions adding to the expected reductions in margins,’ explained Chair Anthony Buttanshaw.
Cash and cash equivalents decreased to £2.7 million from £4.4 million the prior year.
The company declared a final dividend of 7.5625 pence per share, maintained from the prior year.
The company said that market conditions are not expected to be helpful in the first half of the current financial year, and it is expected the order book to decline and worsening in trade.
‘The directors are hopeful that the actions they have been taking will give us a fair chance of restoring growth in the second year,’ said Chair Buttanshaw.
Shares in Samuel Heath & Sons were quote 425.00 pence in London on Friday morning, having last traded at 462.50p each on Thursday morning.
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