Xaar to transfer manufacturing from Sweden to UK

Xaar said that subject to consultation with the representatives of the workforce of approximately 130 at the company's Swedish manufacturing facility in Järfälla, near Stockholm, the company proposes rationalising its production of printheads by transferring manufacturing from the plant in Sweden to its facility in Huntingdon, near Cambridge, and the eventual closure of the Järfälla facility. The process is expected to take about two years and is expected to achieve a substantial reduction in manufacturing costs; a reduction in management overheads; better use of production capacity; improved operational efficiency; and the elimination of exchange rate exposure between sterling and the Swedish kronor. As part of the proposed rationalisation, it is expected that approximately 100 new jobs would be created at the Huntingdon plant over the period of the transfer. Reporting the company’s 2008 financial results which saw turnover fall back to £42 million (2007: £47.9m) and pre-tax profits cut to £4.4 million (2007: £7.3m, chairman, Phil Lawler said the company was in a “robust” position. He went on: "Despite the unpredictable economic climate and slower than desired rate of adoption of technological change in the commercial and industrial printing market, the board remains optimistic that Xaar has the right products now and is developing the right products for the future. Most importantly, Xaar remains profitable and cash generative with a strong balance sheet including substantial net cash balances." The results reflected the effects of lower sales in the Chinese market, the company said. 2008 had proved to be both a difficult and disappointing year despite the substantial market potential of Xaar's technological leadership, Lawler reported. Progress towards the digital transformation of commercial and industrial printing was continuing steadily, but at a rate that was frustratingly slow. However, many independent analysts and OEMs were now clear that inkjet would play an increasing part in the £250 billion commercial and industrial printing market.