Goodwin blames Brexit turmoil for drop in first-half profit

Goodwin blamed political upheaval in the UK for a decline in first-half profit as the engineering company's clients put projects on hold.

Pretax profit for the six months to the end of October fell 5.1% to £7.4m as revenue rose 3.8% £70.1m from a year earlier.

Chairman Timothy Goodwin said: "This is a feature of the disruption caused by the commotions in our parliamentary system over the past six months where the uncertainty has temporarily stalled projects."

"With further clarity over Brexit, we will be looking to start capitalising from the tremendous success our group companies have had in winning large amounts of business from new market areas."

Goodwin shares fell 18.4% to 2,889p at 10:41 GMT. The shares had risen from 2,530p to 3,600p in 2019 before the results announcement.

The company is controlled by the Goodwin family, which founded the business in 1883. Based in Stoke, Goodwin employs more than 1,000 people and produces industrial products such as castings, valves, radio antennas and heat resistant powders and cements.

Goodwin said the company's profitability in the next six months was likely to be similar to that achieved in the first half with cashflow improving. He warned there had been an unforeseen fall in demand for consumer jewellery that uses Goodwin's casting powder as a result of the US-China trade war.

"However, at the time of writing, it appears the market is beginning to improve," Goodwin said.

The company's mechanical engineering division has good prospects despite a subdued petrochemical market as developing economies that consume power from the US gas market become wealthier, he said.

"We have every reason to believe that the new financial year will allow our group companies to start increasing profits," Goodwin said. "We also expect to have further successes in winning significant new business."