Castings profit hurt by pandemic impact
Foundries group Castings has reported a fall in profit and revenue as the coronavirus pandemic caused disruptions.
The Brownhills-based iron casting and machining company posted a pre-tax profit of £5 million for the year ended March 31, down from £12.7 million the previous year.
Output fell by 80 per cent in the first two months of the fiscal year as clients stopped building trucks, and while demand increased in the second half, production was disrupted by employees needing to self-isolate.
Revenue also fell to £114.7 million from £138.7 million.
The company said that while it is now back to full production, its clients are still grappling with shortages of semiconductors and other critical components and that it has seen large jumps in raw material prices.
"It has been a very difficult year for the company and its employees as a result of the Covid-19 pandemic," the firm said in a statement. "As stated in the interim report in November, output was reduced by 80 per cent during the first two months of the financial year. This was because all our major customers in the commercial vehicle sector stopped building trucks.
"During this period of lower demand we had to furlough many of our employees. The furlough scheme was put in place by the government to help employees retain their jobs; the alternative would have been a significant number of redundancies in the group.
"During the second half of the year, demand continued to increase to pre-Covid output levels. However, production was hampered by more employees needing to self-isolate as UK Covid cases increased around the turn of the calendar year."
Looking ahead, it added: "Our customers are forecasting increased volumes in the second half of this financial year and despite some problems in their supply chain we are maintaining full production and increasing our stock back to our previous levels."
