Sheffield Forgemasters “committed” to recovery despite redundancies

Sheffield Forgemasters has announced that up to 100 redundanciesacross all its divisions will take place as the business must be restructured.

The Brightside Lane-headquartered firm has said the job cuts are due to a reduced activity in the oil and gas sector, the slowing down of growth in the global economy and an international collapse in steel prices.

After expressing caution in its 2013 financial results, all these elements have drastically affected Sheffield Forgermasters’ results for 2014.

The firm also cites acute pricing pressures from international competitors combined with high UK energy costs as key factors, but remains firmly focused on long-term objectives, despite announcing essential redundancies.

Forgemasters is now attempting to create a more streamlined operation, better able to work in the tough economic environment.

The redundancies were announced as it published statutory accounts for the 18 months ended 31 December 2014, which show a loss for the first time since the management buy out in 2005.

But despite being in an industry where many of Forgemasters’ global competitors have struggled to survive, its chief executive Dr Graham Honeyman has claimed that a longer recovery time for the advanced manufacturing sector, coupled with increasing costs, will impact the company’s overall profitability. .

He said: “This is undoubtedly a long period of industry contraction with major recovery seemingly still some way in the future, but we are committed to a return to stronger trading and a long-term view.

“We excel at what we do and our technological advances are the best in the world. We also have strong trading partnerships and these organisations continue to place orders with us.

“Under normal trading conditions, we believe we can compete with our global competitors, but when the circumstances we face are so adverse, despite being a fiercely independent company, we have felt compelled, along with others in our sector, to have to canvass action from Government to look at ways they might take urgent measures to regularise the competitive and market environment for UK manufacturers.

“There has been some positive response particularly with regard to electricity costs for major users like Sheffield Forgemasters but more remains to be done.

“It is unfortunate that we have had to announce redundancy plans, but these are to preserve the majority of jobs here in Sheffield and are very much viewed as a short-term necessity. We anticipate retirements and voluntary redundancies will make up part of the process with an emphasis on relocation within the company where applicable.”