UK: Darby Group in the black after restructuring

UK flat and bent glass group Darby Glass announced that there were no exceptional costs in 2002, following exceptional costs of GBP 1.9 million in 2001, reflecting the completion of a restructuring ex…

UK flat and bent glass group Darby Glass announced that there were no exceptional costs in 2002, following exceptional costs of GBP 1.9 million in 2001, reflecting the completion of a restructuring exercise carried out over the last few years. Non-executive chairman Stephen Knight said: “The company continues to operate in an extremely competitive marketplace, and at present there are some signs of uncertainty in the economy. “Nevertheless, we view the future with confidence, and the company is now well equipped in terms of management and capacity to maximise the opportunities which do exist.” Chief executive Hugh Hayes said the Glazing Products division had a very positive year, trading well at all six sites. Overall sales increased by 14 %, helped by changes in UK building regulations. The changes require windows in most new and replacement installations to fulfill significantly higher standards of insulation than previously required. Mr Hayes said: “From April, 2002, the company saw a steadily increasing percentage of its product sales to be of a specification suitable to meet the new regulations, where the onus falls on the window installer to correctly specify and warrant the window frames and unit installations.” “The company now produces a significant percentage of its insulating glass units to the new standards, and expects further sales growth of this type of product as the window industry moves to full compliance in the UK.” The division made significant investments in plant and equipment in 2002, with new automated unit production lines at the Scunthorpe, Glengarnock (Scotland) and Gloucester sites. Mr Hayes said the new lines gave the division substantial extra production capacity for units produced to a consistently high quality. All the lines were capable of exceeding the requirements for higher thermal performance that were anticipated in future amendments to the building regulations. The Processed Glass Division continued to suffer from the serious downturn in the street furniture and outdoor advertising markets, where the division has a considerable market share. The division invested heavily in market research during 2002, identifying a much higher demand for thicker glass for the architectural market in general, and a need for a new entrant in the internal architectural market in particular which would meet the needs for partitioning and balustrading applications. Mr Hayes said: “Late in the year the management structure of the division was changed, the product offer defined, and a new divisional package launched to architects, specifiers, contractors, and similar industry specialists, supported by a concentrated marketing and awareness campaign. Enquiry levels since the launch have improved dramatically, although as the market application is contract driven, the sales growth rates are expected initially to be modest, but ultimately robust.” “The investment in market research, product development, and marketing was supported by capital investment in a new print table and a heat soak oven both specifically to assist sales into the targeted sector in 2003 and beyond.”