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Darchem Engineering, near Darlington, reveals strong financial results
AN expanding North-East precision engineering firm, which is working on a £1.2m deal to supply the Indian Navy with fire protection equipment, has continued its growth after seeing turnover increase by more than £12m.
Darchem Engineering, based at Stillington, near Darlington, has revealed strong financial results, with turnover rising from £62m to £75m, and operating profits hitting £18.1m from £16.1m, for the year to October 26.
The company, which is building a new £8m 75,000 sq ft plant, that will add 86 new jobs to its existing 650-strong North-East workforce, says gross profits have risen to £23.7m, with profits after tax growing from £11.8m to £13.6m.
The firm makes specialist metal fabrications, fire protection and insulation products for the aerospace, nuclear, oil and gas and automotive industries, and earlier this year signed a contract to protect Indian sailors with a fire barrier designed to withstand temperatures up to 1,000 degrees celsius.
Bosses say they expect its strong order book to drive the business further forward in the next 12 months, increasing turnover and safeguarding jobs.
In a report, former managing director Graham Payne, the company, which is part of the US-based Esterline Group, says orders in the oil and gas industry have remained steady, with improvements in its construction vehicle supply market.
Mr Payne, who stood down from his role in June, said: “Turnover increased by 20 per cent during the year as commercial aerospace industry continued to increase production rates.
“We achieved some revenue recognition on the first of the new aircraft carriers being built for the UK Ministry of Defence.
“The oil and gas market continued to operate at reasonable levels and we saw an improvement in the construction vehicle market, with our order book remaining strong.
“In addition to the strong order book, the timing of revenue recognition on large projects indicates turnover will exceed 2012 levels, which will sustain profits and employment levels.”
The firm's Indian contract, which is being worked on by a team of 12, is due to be completed next year and scheduled for installation in autumn 2015.
The company will draw on previous experience of making similar protection systems for the Royal Navy, which have been installed on the HMS Ocean, HMS Queen Elizabeth and HMS Prince of Wales aircraft carriers, as well as the Spanish and Australian navies.
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