Partner Article

The worst is over, says embattled manufacturer

A MANUFACTURER of hydraulic excavators has plunged into the red with a £655,000 annual loss, but believes it has now come through the worst of what has been a dire market in recent years.

Komatsu UK, which employs over 300 people at its site in Birtley, Gateshead, saw its annual turnover plummet from £150.2m in 2009 to £71.4m in the year ending March 31 2010.

After making a £2.6m profit after tax in 2009, the company slipped into the red as a market which collapsed last year has continued to diminish amid tough economic conditions.

However, according to a company statement, things could be set to improve for the firm as the recovery edges ever closer.

The firm said: “In the year to March 2009, the demand for medium sized excavators collapsed and price competition intensified dramatically as both manufacturers and distributors sought to dispose of large amounts of inventory.

“The directors believe that the market has now reached the bottom and do not anticipate it will fall any further, however, the pace and extent of recovery remains uncertain in light of continuing economic problems throughout Europe.”

Since the start of the global economic downturn of the last three years, Komatsu UK – which moved into Birtley in 1985 - has been forced to make 500 of its workers redundant.

This was posted in Bdaily's Members' News section by Ruth Mitchell .