Ennstone enjoys jump in interim turnover to more than £100m

Ennstone has pushed its first-half turnover beyond £100m for the first time.

Vaughan McLeod, chairman, said that Ennstone’s UK operations had achieved “strong price growth” while the Polish business continued its “impressive performance”.

However, news from the US was gloomier, with Ennstone’s operations suffering from a continuation of the tough US market conditions, plus the effect of a weak dollar which bit into translation of profits and also the consequences of difficult weather in the first quarter.

The group’s pre-tax profit was trimmed back to £4.7m (comparable figure in the first half of 2006: £5.4m). Turnover of £113m was well ahead of the previous figure of £94m.

The restructuring of the Building Products Division into Ennstone Concrete Products has largely been completed with the sale of the natural stone building products element, a business which was operated from sites at Burford and Stainton. This triggered redundancy costs of £430,000 which cut into the final profit figure.

Overall, the move is cash positive and it allows Ennstone focus on its new Concrete Products operation.

Ennstone continues with its policy of extending consented reserves at more than twice the extraction rate over the next 2.5 years.

Net debt has been cut from £150m to £130m.

Operations in the UK are split into three elements:

UK Aggregates

Strong pricing, together with a full period of trading from the majority of the asphalt and ready-mixed concrete capacity commissioned during 2006, resulted in a 20% jump in underlying operating profit.

UK Concrete Products

The operation is on course to use 200,000t of aggregates a year. There are plans to develop new capacity at Cadeby, some 16 miles from the main base at Cloud Hill Quarry.

BEAR Scotland

Ennstone’s term maintenance joint venture, which operates north of the Border, won the contract for the trunk roads in the South East region of Scotland. BEAR retained the North East contract for a further five years.

The jv carries out design work and gives Ennstone products a useful route to market.