Umeco cautious

Umeco today released its preliminary results for 2009, revealing a strong overall performance from the company despite challenging market conditions.

Highlights from the company, which provides supply-chain services and advanced composite materials, include £415.3m revenue from continuing operations compared with £335.2m in 2008.

The company’s adjusted operating profit of £35.2m represents underlying growth of 13 per cent compared with 2008 and profits before tax were 32.4 per cent higher at £29m.

Earnings per share were 10.4 per cent higher at 40.5p compared with 36.7p in 2008, but the company cautioned that it is planning for more modest revenue growth and that it will focus on cost control and debt reduction.

Clive Snowdon, chief executive of Umeco, said: ‘We are pleased with our performance during what has been a period of increasing instability in our end markets.

‘In the first half of the year, rapidly increasing oil prices caused significant losses by many carriers and led to increased ticket prices, not helped by higher UK taxes on travel.

‘During the second half-year we suffered from the strike at Boeing and then the rapidly deteriorating global economic situation, which has caused a significant fall in premium and cargo traffic.

‘In addition, exchange and interest rates have been extremely volatile during the year, impacting our net debt, which is largely US-dollar denominated to hedge against our US assets.

‘In view of this high level of uncertainty we have significantly reduced our capital-expenditure plans, focused upon improving our working capital ratios and where appropriate have reduced our cost base, primarily through lower headcount.

‘We enter the new financial year with a solid order book.

‘Nevertheless, we are mindful of the uncertain macroeconomic environment in which we operate and therefore are planning for a year of more modest growth in revenue.’