Profile: Nigel Rogers

ITS slogan, ‘The world turns on Colchester lathes’, reflects a firm whose metal-turning machines are famous around the globe.

But the world has turned more slowly for 600 Group in recent years.

The Yorkshire-based machine tool maker, founded as scrap metal merchant George Cohen, Sons & Co in 1834, has struggled to find its place in a cut-throat global market.

At times 600 Group has appeared torn between wanting to be a manufacturer or distributor or both.

Commoditised manufacturing has been outsourced to China, switched to Taiwan, returned to Europe and is now being sent back to Taiwan.

Its latest results showed annual revenues dropped below £40m, compared with £98m in 2001. Once restructuring costs and impairments were factored in, losses in the year to the end of March hit almost £15m.

To new chief executive Nigel Rogers, 600 Group’s problem has been “finding the optimum supply chain in order to satisfy... demand”.

The former Stadium Group CEO was drafted in in March to deliver stability and growth after a decade of contraction.

His response was swift and ruthless. Surplus land and properties are on the block, its South African waste handling machinery business has been sold, jobs are being cut at its Heckmondwike factory and the head office is moving from Leeds to Heckmondwike.

Polish manufacturing, part of its much-vaunted vertical integration strategy, has been terminated. The Polish factory was only bought in late 2010, from weapons group Bumar, for 1m euros.

Former CEO David Norman bought the factory to take a significant proportion of manufacturing in-house, after becoming concerned 600 Group was a “distributor selling to distributors”.

Rogers does not condemn the Polish venture – which has cost 600 Group £3.5m to £4m – as a mistake.

But, he said, the “operational and financial control in Poland was perhaps not what it could have been”. Inventories and labour and material costs kept climbing, and this summer it “reached a tipping point where those costs could not be supported”.

The loss-making business was recently sold to German firm GDW Werkzeugmaschinen Herzogenaurach, saving 200 jobs.

To Rogers, a successful manufacturing strategy involves sending cheaper, commoditised work to be made abroad, but retaining niche, high-value production in-house.

Manufacture of its manual lathes – popular with school design and technology departments – is being transferred again to its outsourced manufacturer in Taiwan, which originally took over from Chinese manufacturing. The decision to make lower value machine tools in China was “probably right”, said Rogers, but “unfortunately with the wrong partner”. “That’s really where the trouble began,” he said.

With its Taiwanese partner, he said the group can retain control over intellectual property and standards.

But despite this, Rogers is an “unequivocal” believer in UK manufacturing. He believes the trend of enviously gazing at the success of Germany’s small and medium-sized Mittelstand companies risks ignoring Britain’s own strengths.

“If you compare the level of design and engineering skills we have in this country with the Mittelstand, I think we’ve got a lot of very competitive strengths,” he said.

“It does not necessarily help being an island, but we’re an island with fabulous trading links. We have the willingness and ability to trade internationally, and we’ve got to build on that.”

What remains in Heckmondwike is a “relatively small” manufacturing operation, but making “world-class” products.

About 85 employees rattle around the 225,000 sq ft site, a vast former mill sandwiched next to a Morrisons supermarket. Rogers plans to “compress” the West Yorkshire factory, selling the freehold and leasing back a smaller portion.

The site makes computer-controlled Tornado lathes, under the Colchester-Harrison brand, used by firms such as manufacturers of precision components for planes and cars. These bespoke machines can weigh up to seven tonnes and sell for up to six figures, compared with around £15,000 for some of its manual machines.

The factory also makes bespoke Pratt Burnerd chucks, some a metre in diameter, prized in the oil and gas sector.

“They command a price which supports UK manufacturing,” he said of the plant’s output. “The unit costs are significantly higher (than the Far East), there’s no getting away from that, but because of our skill base, flexibility of working, designs and manufacturing knowledge, we’re able to command that price.

“You would not want to go to a low-cost place to make expensive systems.”

Sales and production at Heckmondwike have been held back by the group’s recent funding squeeze, but Rogers is believes that is about to change after a £1.5m share placing, debt reduction plan and new credit facilities.

“Our expectation is that we ought to be able to see very strong growth in that area from a very low base,” he said. “That’s a business where the additional financial resources we have will give us some significant benefits.

“We’ve strong order books looking forward. That’s been an overpowering positive despite the changes.

“There are clear signs that significant improvements will be evident in the second half of the financial year.”

Rogers, an accountant turned CEO, is not accompanied by finance director Neil Carrick when we meet at the London office of 600 Group’s broker for his maiden set of annual results. “He was up until 12am so I gave him the day off,” he said.

Rogers, 51, is described by analysts as a “safe pair of hands”. “The institutions really like him. He’s incredibly competent as a CEO,” said one analyst. “He’s also well aware of his own competency.”

Rogers was born in Sunderland and started out with PricewaterhouseCoopers. His career with the accountancy giant took him to the Cayman Islands, where he “did a bit of scuba diving and worked much harder than I expected”.

He returned to Britain to work in London, before being sent, aged 28, to run its office in Oman.

On his return, with two young children, the “old magnetic pull” lured him back to the North East. After a year at laminate surface firm Formica Corporation, he joined industrial firm Stadium Group as a finance director in 1993.

He was FD when the group floated on the stock market in 1996, became managing director of its electronics division in 1998 and rose to CEO in 2001, aged 39.

There are parallels between Stadium and 600. Stadium was heavily indebted, had just expanded into China through acquisition and was a diversified industrial in need of focus.

Rogers focused the Hartlepool-based company on electronics, selling non-core businesses such as its plastics division, before finally standing down in 2011.

“I reached a point where I was going to be a one-company man if I didn’t find a new challenge.”

He and his wife, Julie, have moved to Leeds’ Brewery Wharf and plan to settle in the city. His son Andrew is working in Chile after graduating from Leeds University, while his daughter Katie is studying photography at Leeds College of Art.

Rogers admits he’s getting a name as a turnaround man. “It would seem that’s the way the die has been cast.”

Nigel Rogers Factfile

Title – Chief executive, 600 Group

Date of birth – July 16, 1961

First job – Trainee accountant in Sunderland

Education – Monkwearmouth School, Sunderland

Car driven – BMW 650i convertible, 140,000 miles and almost run in

Favourite holiday – Fell walking, preferably in Spain

Last book read – Mr Nice, Howard Marks

Favourite music – from Beethoven to Sex Pistols, but currently Rizzle Kicks

Favourite film – Where Eagles Dare

Most proud of – A great family and breaking 80 on the golf course a couple of times