Made in the Midlands member Setec, a Jaguar Land Rover supplier headquartered on the edge of Birmingham is projecting a more than 50 per cent increase in EBITDA and said it is performing ahead of expectations.
Newly filed documents for Coleshill-based Sertec Corporation for the year to 31 March 2019 have revealed its turnover went from £273.4m to £232m while it made a pre-tax loss of £8.9m after reporting a profit of £4.6m in the prior 12 months.
Sertec said its performance was down to it being forced to cut jobs, close sites, agree "economic adjustments" with its customers and suppliers as well as launch a "comprehensive review" of the facilities it acquired as part of the purchase of the Wild Group in August 2016 as a result of Jaguar Land Rover's "sudden and unexpected" decision to reduce its parts orders in October 2018.
A statement signed off by the board said:
"The group reported a 15 per cent year-on-year decrease in turnover which was the significant contributing factor to the group reporting a small underlying operating loss."
The board also decided in March 2019 to agree a refinancing plan which would provide the group with "sufficient financial resilience" to be able to cope with similar events should it happen again in the future.
Completed on 28 June 2019, the move strengthened the group's balance sheet and provided it with £10m of new cash.
Sertec added that while the measures incurred one-off charges, it still reported an EBITDA of £10.1m which it said was "reassuring".
The group has forecasted that it will achieve a higher EBITDA for the year to 31 March 2020.
Also during the year significant investment in additional presswork capacity and automation was completed and the logistics functions were centralised into a new distribution centre at Hams Hall in north Warwickshire.
The group also confirmed that it secured nearly £1bn-worth of new contracts during the year.
Chief executive Grant Adams added:
"Given ongoing uncertainty, the past 12 months hasn’t been without its challenges across the wider sector, but we’re stronger for it and already seeing the rewards with new contract wins from a number of car manufacturers.
"We’re optimistic about the year ahead. Our ongoing investment in new technologies is what’s made us one of the UK’s leading OEM suppliers.
"The opportunity in the industry around electric vehicles is huge and we’re at the forefront of that.
"Internationally - our site in Hungary is perfectly placed for the mainland European market at the centre of an automotive manufacturing hub. Our aim is to double the turnover of this location in coming years."
Source: Insider Media Limited
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