Analysts back Carclo despite '˜operational weakness' hitting profits

Bosses at plastics manufacturer Carclo conceded the firm had endured a disappointing year after delays in project awards and operational weaknesses dented its profits.

Carclo - Chris Malley.

The Ossett-based firm saw operational profits fall to £9.9m from £12m the previous year, despite a 5.7 per cent boost in revenue to £146.2m in the 12 month period to March 31.

The company cited issues from within the Carclo Technical Plastics division in particular as being behind the failure to achieve profit targets but insisted that customer development activities and the development of its footprint remained strong.

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Michael Derbyshire, chairman at Carclo, said: “The group’s strategy over recent years has been to create sustainable growth in revenues and operating profits through the development of innovative and highly efficient solutions for our existing and new customers to ensure that they enjoy real benefits accruing from working with partners like us.

“While the year has been disappointing, the board remains confident in the underlying strength of the group and its people to recapture the momentum of recent years and to drive significant value for our shareholders in the future,”

Analysts at Peel Hunt responded favourably to the update, issuing a buy notice on the firm.

Shares in Carclo closed at just over two per cent down on the previous day’s trading.