Turmoil in the Middle East hits profits at Allam

The company, which was founded by Hull City owner Dr Assem Allam, saw its turnover fall from £185m to £100m last year, while pre-tax profits fell from £22.6m to £11.2m.

However, Dr Allam said that Allam Marine had a bright future, because of anticipated demand in places like Libya.

The company helps to provide heat and light in some of the world’s most isolated communities.

Dr Allam, who is Allam Marine’s managing director, said yesterday: “Europe and the Middle East are significant markets for Allam Marine and both regions suffered considerable turmoil in 2012 – Europe from the ongoing economic crisis and the Middle East due to continuing political upheaval.

“It is no surprise that we saw exports to these regions fall. This, coupled with some de-stocking in developing nations brought about by tougher global banking conditions, has led to an overall drop in sales.

“However, in light of the difficult economic conditions, we continued to generate a robust and profitable performance in 2012 and unlike many of our competitors who made redundancies, we coped with the difficult period by having a reduction in overtime only.

“We remain optimistic for the future; demand remains very strong and already this year we have experienced an increase in sales, due to the rise in confidence and stabilisation of the eurozone and political acclimatisation in the Middle East.

“Our biggest UK competitor moved 70 per cent of their manufacturing to China, which has had a positive impact on the demand for our UK manufactured products.

“To deal with this increase in demand, the company’s production manager confirmed that he is currently looking to recruit up to 10 additional staff this year for positions such as product engineers, test engineers and mechanical and electrical assembly workers.”

Dr Allam said that 2013 “looks to be promising” for Allam Marine, and he predicted that turnover might return to £185m.

“Electricity is the most important commodity after water,” he said. “In developing countries the demand is there because of the unreliable national grid.. demand can be delayed but not disappear.”

He said there was more of a “feelgood factor” in parts of Europe, and the market in Libya had the potential to increase night shift work.

Allam Marine has seen increased demand for higher capacity units, because “big projects need big power”, Dr Allam said.

Dr Allam was named Business Leader of the Year at the Variety’s Yorkshire Business Awards, in recognition of his business achievements and community work.

Allam Marine, which has around 50 staff, supplied generators to villages in Sri Lanka that were devastated by the tsunami of December 2004. In recent years, generators have been supplied to the Royal Palace in Dubai and Tottenham Hotspur FC.

The generators can provide power for a whole village, which means drugs and medicines can be stored in remote places.

They can also be used in an emergency when the mains electricity has been knocked out.

In October 2011, Dr Allam signed a three-year agreement to sponsor the Allam British Open Squash Championship. According to Dr Allam, the squash championships will “lift the image of Hull”.

Apart from owning Hull City, he is also a strong supporter of community football projects for children aged seven to 16.

In 2009, Dr Allam donated £1.5m to the University of Hull to establish a bioscience research centre. He is also well-known for his work as a trustee of the Daisy Appeal at Castle Hill Hospital in Hull, which helps cancer and heart disease sufferers.

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