600 Group reports turnaround ‘almost complete’

Norman went on: "The improvement in orders we experienced in the second half has been sustained post year end and we expect this to continue. With the proposed funding in place, the Group will develop its manufacturing footprint to increase capacity and, therefore, improve its ability to supply. This, combined with the predicted upturn in the machine tools market, leaves us well placed to deliver a significant improvement in performance." Revenue for the period was £45.4m (2009: £76.2m) and while the pre-tax loss increased to £8.7m (2009: loss of £8.0m), the group returned a second half operating profit of £0.6m (2009: operating loss £2.5m). The 600 Group PLC ("the Group") is now a diversified engineering group with four principal areas of activity: Machine Tools (41% of sales); Precision Engineered Components (26% of sales); Laser Marking (15% of sales); and Mechanical Handling and Waste Management (18% of sales). Norman reported that in the last 18 months, the group had reduced the number of its locations from 29 to 12 and the vast majority of its restructuring was now complete. During the year, the Machine Tools division completed the change from a dependence on outsourcing in China to other sources in Asia. Over the last 18 months, meetings had also been held with potential manufacturing partners in Central and Eastern Europe (CEE) where manufacturing businesses were logistically well positioned, given EU membership, and possessed the necessary operational capabilities. "Our aim is to work with a manufacturing partner in CEE to combine production with the manufacture of certain critical components in the UK to give a manufacturing footprint located in the same geography as our European customers," Norman said. "We are particularly looking for a partner who will accept a degree of management control with the further prospect of the group acquiring a subsequent financial interest." Looking ahead, chairman Martin Temple said: Although we remain cautious in our outlook, there are clear indications of improvements in the group's four core business markets and this is reflected in the more recent levels of order intake. "We now need to increase our capacity to supply and reduce our delivery lead times to take full advantage of this improvement in demand."