Chamberlin flags losses after restructuring and contract loss
Specialist castings and engineering company Chamberlin updated the market on its trading on Friday, reporting that following the loss of the BorgWarner contract late last year, and the consequential restructuring of operations and refinancing, it would report a loss for the extended accounting period ended 31 May.
The AIM-traded firm said it was confident that, as the “substantial majority” of its restructuring costs and non-cash write-downs would have been accounted for in the year ended 31 May, it would be “well-positioned” to make a strong recovery in the new financial year started 1 June.
As it had previously announced, the company initiated a number of business development initiatives at Chamberlin & Hill (C&H) to diversify the customer portfolio in order to reduce reliance on the automotive sector.
“The main thrust of these initiatives are in the area of new consumer products where we have technical and design advantages where these can be sold primarily via e-commerce direct to the consumer,” the board said in its statement.
“We have already received considerable interest in our growing gym equipment range and now are preparing to launch a range of premium quality cast iron cookware for distribution across Europe.
“We are pleased to be the only British foundry producing many of these new consumer products.”
The directors also reported a “strengthening performance” at Petrel, which was broadening its scope to include product hire and the provision of support services for new and existing safety lighting installations.
Russel Ductile Castings, meanwhile, was continuing to outperform expectations, with the board seeing “great scope” for further growth and improved profitability in the current financial year.
Its growing success was put down to a lack of competition in the UK foundry industry for niche, low-volume, large capacity castings.
“With revenues now stable, costs realigned to reflect the current operating base across the group and exciting new potential growth opportunities, the board anticipates that Chamberlin will see a return to profitability in the current financial year.”
At 0938 BST, shares in Chamberlin were down 0.19% at 10.73p.