Cosalt expects safety reviews in the wake of Gulf of Mexico spill

The Grimsby-based group, which provides inspection services and maintenance on oil rigs, said that inspection levels are likely to be doubled.

Cosalt's chief executive Mark Lejman said health and safety standards in the North Sea were already of very high standards and were likely to stay the same but other areas in the world, where standards have been far more lax, now needed to catch up.

"The level of inspection and servicing needs to be upped to prevent a disaster like the Gulf of Mexico ever happening again," he said.

He was speaking yesterday as the group announced a doubling in first-half adjusted pre-tax profit to 1m, helped by cost cuts.

But sales fell 8.5 per cent to 48.3m in the six months to May 2 as clients in the UK North Sea offshore division reduced spending on capital projects. The company kept a cautious full-year view, sending shares down 10 per cent, a fall of 0.63p to 5.75p.

Cosalt's offshore division has been held back by low spending by oil and gas companies, particularly in the North Sea, but is now seeing signs of spending picking up.

"There's no question the UK is still finding life difficult," said Mr Lejman. "We are seeing a slight improvement in marine and offshore, but it's patchy. Usually we see a pick up in June, July and August – the summer months when we do maintenance work. So far June is looking ok."

The company has restructured itself to focus on providing equipment and services to the oil, gas and marine industries.

It reported an improving earnings trend, with a half year 1.5m loss compared with 3.4m loss a year earlier.

The company, which also provides safety equipment for the offshore oil & gas and marine industries, has begun to see an increase in activity for the second half after two months of lower-than-expected levels.

The group said it had retained all the contracts which came up for renewal over the period including major oil contractor PSN and it had won a number of new ones.

The group recently won a substantial framework contract with the South East Fire Brigades worth over 30m over eight years for the supply of personal protective equipment and associated services to 12 fire and rescue services.

Following the deal Cosalt will provide services to nearly half of all the fire and rescue services in the UK, making it the clear market leader in the sector.

Cosalt said the new framework agreement could be expanded to other fire and rescue authorities, fire training schools, airport services and other emergency services within the UK.

The group's Crewsaver brand had a positive start to the year and introduced a number of new products including the Crewfit 190 range of inflatable lifejackets which have been well received by customers and sailors who demand high-quality equipment.

Other new products are being developed to target the rescue sector and commercial marine and exploration markets and are due to be launched towards the end of this year.

The group also plans to expand its operations in the renewable energy market.

The company already works with a number of customers in the sector, but it has now set up a dedicated Renewable Energy division to operate alongside its existing marine and offshore businesses.

Cosalt supplies marine safety, lifting equipment, tooling and height safety products for offshore wind farms.

The company has bases in Grimsby, Lowestoft and Birkenhead, which offer immediate access to the wind farms being built off the Humber, Wash, Kent and the North West coastlines.

Cosalt said it could also provide inspection, testing and maintenance services for the renewable energy market.

Its main priority is to drive growth so the board has not recommended an interim dividend. It will start paying dividends once there is a clear improvement in the business.

Efficiency drives office move

Cosalt recently moved its head office across Grimsby.

The group, which started life in the 19th Century as The Great Grimsby Coal, Salt and Tanning Company, moved from its Fish Dock Road home to Origin 4 at the nearby greenfield Europarc development.

The relocation is the first time Cosalt has moved from Grimsby Docks.

Chief executive Mark Lejman said: "While the old building has served us well for many years it no longer met the needs of a growing international business. It is important that our offices reflect a more collaborative working style where it is easy for people to share information and work together in an open plan arrangement.

"Origin 4 provides everyone with a better working space and easier road access. It will help us run the business more efficiently."

The office, on two floors, includes rainwater harvesting and rooftop solar water heating panels.

Initially it will house about 45 staff.