Sheffield Forgemasters reduce losses as turnaround plan has "a positive effect"

Engineering company Sheffield Forgemasters International Limited (SFIL) has posted a reduction in losses for the financial year ending 2015.

During its financial results for 2015, the company reported an operating loss of £4.8m, a pro-rata loss reduction of more than £3m over the previous 18 month financial year.

During this time, Sheffield Forgemasters significantly reduced activity in the traditional oil and gas sector. The slowdown of growth in the global economy and high energy prices have continued to impact the business, but management remains confident that 2016 will show further improvement.

Tony Pedder, Sheffield Forgemasters’ chairman, said: “Although we anticipated the business to run at a loss for the financial year ending 31 December 2015, we are encouraged to see that steps to streamline the business and early implementation of the turnaround plan is having a positive effect.

“Outlying circumstances such as high energy costs, a collapsed oil and gas sector and long-term effects of a global economic downturn still conspire to make trading very difficult across all sectors.

“However, we are confident that the company is heading in the right direction and that our work to maximise efficiencies, break into new markets and continue investment into new technologies and processes will pay dividends in years to come.”

Sheffield Forgemasters posted a 2015 turnover of £72.8m compared with the 18 months to December 2014 of £122.4m (£81.6m annualised) and overall operating loss of £9.3m (£6.2m annualised).

Dr Graham Honeyman, Sheffield Forgemasters’ chief executive, commented: “We are still fully committed to a return to stronger trading in the future.

“The manufacturing excellence and technological advances of this company are not equalled by any of our competitors and that approach is as relevant to the company’s current challenges as it was at the point when we engineered the management buyout in 2005.

“The next 12 months will require a lot of work but we have already made vast inroads into restructuring the business towards profitability and are anticipating a stronger year end in December 2016.”

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