Sanderson on a journey back to recovery as revenues improve

The group, which designs and sells software to retailers and manufacturers, said while trading has been hit by the UK’s slow economic recovery, it is confident of reporting a stronger second half.

Sanderson, which has its manufacturing headquarters in Sheffield and its retail office in Bradford, together employing around 70 staff, reported a dip in revenues during the six months to the end of March, from £13.3m to £13.1m.

But the group’s pre-tax profits soared to £395,000 from £34,000 a year ago. Sanderson’s gross margin increased by 3.5 per cent to 70.6 per cent and its order book increased to £3.3m from £3m. “We’re on a journey,” said executive chairman Christopher Winn. “We had a bad time in 2008/9 and we’re recovering. Part of that is knocking down debt and the other part is setting us on the path to medium-term growth.”

After peaking at £12.5m in March 2008, the group’s net debt is down to £7.2m, from £9m a year ago.

Sanderson said it expects its bigger order book to result in a stronger second half, when most of the projects are scheduled for implementation and delivery.

The group also lifted its dividend to 0.3p per share from 0.25p. Recurring revenues now make up 54 per cent of its total sales after growing six per cent to £7.1m.

Sanderson claims to have improved its market position, helped by new products.

Analysts at house broker Charles Stanley said: “Sanderson’s statement should provide investors with confidence.

“The company appears to be on track to meet or beat our full-year estimates.”