STEEL group Billington Holdings described 2011 as “without doubt the most difficult trading year in the history of the group”.
The Barnsley-based company reported an overall loss of £1.7m for the year to December 31, down from an £800,000 profit the previous year.
This was slightly ahead of management’s expectations at the time of the group’s trading statement last November and the company’s shares closed unchanged at 67.5p.
A 27 per cent increase in revenues to £53.9m was offset by margin erosion due to the challenging market conditions.
The group said the combination of an increase in steel prices and a highly competitive market led to downward pressure on margins.
In addition it had to face some unexpected contract difficulties. The problems were limited to a small number of projects and it has made a number of management changes to improve its supply chain.
The group is not paying a final dividend, saying that it needs to preserve cash for working capital requirements.
Billington said it has completed its strategic review which should deliver cost savings of £2.8m a year.
The group has downsized with the loss of 80 staff bringing the total employee count down to 295. Chief executive Steve Fareham said there are no plans for any more job losses.
Following the review the group is taking on more niche work.
“We’re not so involved in the cut-throat market. We’re now able to slow down and be a bit more selective,” said Mr Fareham.
The reorganisation involved the move to a single pattern of shift working.
The group is hopeful that it may see a pick-up in the latter half of 2012.
It said that the current workload for its Peter Marshall Stairs business is encouraging and following management changes, it expects a positive contribution from the business in 2012.
Chairman Peter Hems said: “We anticipate that there will be a slight improvement in trading conditions during 2012, albeit probably not until the latter part of the year.
“That slight improvement, together with the unfortunate loss of a number of competitors in the structural steelwork sector and our reduced cost base, give us a degree of confidence as we move forward into 2012.”