SHEFFIELD-based engineering group Pressure Technologies today said it would press on with its diversification strategy as it posted a fall in full year profits.
In the full year ended October 2, revenue was 21.7m, compared with 26.2m the year before, while the pre-tax profit was 3.5m, down from 5.1m.
Richard Shacklady, the chairman of Pressure Technologies, said the group had produced a solid set of results for the period, despite the severe downturn across its main market sectors.
The general economic downturn, which began to affect the business in 2009, was compounded by the BP Macondo oil spill in the Gulf of Mexico, Mr Shacklady said.
According to Mr Shacklady, this had a massive impact on the offshore deepwater oil and gas sector and set back the recovery in deepwater drilling investment activity by around 12 months.
He was pleased to report that the company was seeing clear signs of renewed activity in the sector.
Mr Shacklady said: "Overall, we expect the coming six months to be the lowest point in the cycle in shipments to the deepwater offshore oil and gas sector.
"All key indicators together with recent orders from the sector suggest that this will be followed by a gradual improvement in forward ordering for shipments in 2011/2012. Activity in our engineered products division is expected to continue growing strongly, as we pursue growth into buoyant market segments.
"The process of diversification, both organically and through strategic acquisition, is transforming the group. It will emerge better balanced, both in terms of products and markets, and the coming year will see this transformation take further shape.
"We are seeing a flow of better quality acquisition candidates both in the UK and overseas. Given our strong balance sheet and cash resources, we are well positioned to exploit opportunities as they arise and the board intends to capitalise on those in niche markets.
"Our dividend policy wholly reflects the board's confidence in the group, its strategy and ability to flex with prevailing market conditions to secure leading positions in growth sectors of our chosen markets, as well as its confidence in the expected medium term recovery of the deepwater oil and gas business."