25 Jun 2018 15:58
TEX HOLDINGS PLC - CHAIRMAN'S STATEMENT - 25 JUNE 2018
I expect you have had time to read our annual accounts and I will be happy to address any questions you may have in due course.
I will now give you a short report of the trading companies.
The Plastics Division is trading in line with expectations. The work that was anticipated to be lost following a price increase has not yet to go.
The increases in minimum wage continues to put pressure on results and to limit this, the Division is exploring additional automation.
Within the Engineering Division, Tex Engineering has again opened the year strongly on the back of increased demand for a number of its product lines. With margin and overheads under control we should see the company report another solid profit this year.
Eurotex are trading at expected levels and are awaiting the decision on a number of quotations and tenders. This company could be positively affected by the decision to extend the operational lives of a number fisheries protection ships pending the UK's departure from the EU.
The A.T.C. Division continues to work towards the completion of the Air Craft Carrier project, whilst in the meantime quoting for a number of air traffic control rooms, both UK and overseas. The company has recovered strongly from the shock of losing Mike McCarthy last August. Currently, the company anticipates receiving a number of orders from Nigeria for air traffic control rooms on projects that were "stalled" a number of years ago.
BSP has opened the year steadily in line with corporate budgets. Enquiry levels continue above the long-term average, but customers continue to be hesitant to place orders in the current economic climate.
G&M TEX opened the year slowly but now has a large order book, unfortunately over £1,000,000 of these orders are not scheduled for delivery until early 2019. As a result of this, G&M TEX is expected to make a loss.
QK Honeycomb Products are trading strongly with turnover up on budget. The company is in negotiations with a major customer, the outcome of which is expected substantially to increase the turnover. The current trading has been affected by operational costs. A new Production Manager has been recruited to streamline the two operations to return this company's profits to respectable levels.
As a Board, we take our responsibilities in supporting our pensioners very seriously. I am pleased to report the pension fund deficit has decreased, this is partly due to the current record stock market levels. We continue to monitor the most cost-efficient way of controlling this liability. The potential cost of buying out the pension scheme liabilities continues to be monitored. The Pension Trustees continue to apply pressure for the company covenant to be maintained.
We will continue to protect the interests of both our pensioners and those who have given many years of good service to the Group, we as your Directors will continue to act in the best interest of our shareholders in both good and difficult times.
I am delighted to hand over the reins to Chris Gray.
Chris has spent many years in the international shipping and transportation industry.
Chris is a former Managing Director of the Port of Felixstowe and Chief Executive of Hutchinson Ports UK and Hutchinson Ports Bahamas.
In October 2017, Chris was appointed as Director of Red Funnel Ltd and Red Funnel Holdings Ltd.
I am sure he will be a very capable and enthusiastic successor.
A.R.B. Burrows