Performance materials group Low & Bonar has hailed the contribution of its Dundee yarns plant as the business closes in on a profits boost.
The company has confirmed it expects its full-year results to be in line with market expectations, namely a pre-tax return of between £26 million and £26.5m for the year to November 30.
The outcome represents a potential £2m uplift from 2012 when the firm posted a pre-tax profit of £24.5m on total revenues of £380.5m.
The strong performance has come despite a weather-affected first half to 2013 which saw delays to major infrastructure schemes on the Continent which L&B would expect to provide supplies for.
However, trading picked up during the summer and sales for the second half of the year were 5% ahead of last year on a like-for-like basis, which strips the effect of new business streams, and 3% ahead overall.
Low & Bonar chief executive Steve Good said he was pleased the business as a whole had seen a pick-up as the year rolled through.
“We had a difficult first half which was affected by adverse weather which delayed the start of the European construction season,” he said.
“There was a bit of catch-up in the second half and a return to more normal levels of growth in the markets.
“We have said that we are in the range of market expectations so it has been a further year of progress for us, which will be the fourth year we have been able to do that in markets that have not been the most helpful.
“We continue to do things to help us go forward.”
Mr Good said one factor in the “much improved” second half was the turnaround in performance in the firm’s loss-making yarns business.
The division makes carpet backing and synthetic playing surfaces from its Caldrum Works site in Dundee as well as at a sister plant in Abu Dhabi.
The yarns business had suffered a “difficult year” last year when it was hit by an £11.2m writedown and suffered a double-digit drop in sales volumes.
However, Mr Good said division, which employs more than 100 workers in Dundee, was back trading profitability after last year’s loss.
“Yarns had done a lot better in the first half of the year and that performance was maintained in the second half,” Mr Good said.
“After a very difficult year last year where we made significant losses we are back in the black.
“We have still got things to do to get further improvement in the business but I am pleased we turned things around this year and I am pleased with the progress.
“There have been two things behind that. The market is recovering somewhat in the US in particular and in parts of Europe, and we are doing things better. It is a combination of internal and external factors.”
The group will publish its full-year results on February 4.