‘THE group has gone through some turbulent times – customers have disappeared.”

Gordon Banham is honest enough to avoid sugar-coating Hargreaves Services’ progress.

The firm, one of the region’s last surviving coal miners, has not been without its difficulties.

Loading article content

Hit by the closure of Redcar’s SSI UK steelworks, where it supplied fuel to light up the Thai operator’s coke ovens and a pulverised coal injection plant installed to increase iron production, its difficulties have been compounded by the winding down of coal-fired power stations.

When SSI was liquidated, more than 150 Hargreaves staff were without jobs, with the company losing millions in annual revenue.

A subsequent tribunal awarded those workers a share of £700,000 after ruling Hargreaves had failed to offer suitable consultation during SSI’s collapse.

Only an insistence on cashon-delivery protected the company from incurring further major losses during SSI’s time in business.

It was a tumultuous period for Hargreaves, which for years had operated under the rule of King Coal.

Yet for Hargreaves, based in Esh Winning, County Durham, it’s very much a case of the King is dead, long live the King.

The mining industry is a shadow of its former glory, with pit closures a reminder of how factors, such as power station closures and a greater focus on green energy, have changed the landscape.

Indeed, the business was previously forced to reveal it was halting coal production at all but one of its seven opencast sites in Scotland after changes in carbon taxes and lower gas prices knocked demand for thermal coal used in power plants.

But while coal mining has fallen from the heights of yesteryear, additions to its operations, such as a transport division, which is increasingly shifting fuels for wasteto-energy plants, and a civil engineering arm are providing fresh sustenance.

Mr Banham, chief executive, said these offshoots are providing a platform for growth, confirming coal hasn’t entirely disappeared just yet, with steam railways, for example, relying on Hargreaves’ supplies for their engines.

Anyone quickly glancing at the company’s latest financial results, in the cold black and white of a stock exchange update, could be forgiven for thinking Mr Banham’s optimism was somewhat misplaced According to the memo, continuing operating profit fell nearly 100 per cent in the six months to November 30, compared to a year ago, from £4.9m to £100,000.

Revenues from its coal distribution division also dropped, from £105.6m to £68.5m, with SSI’s liquidation a significant factor.

However, Mr Banham, speaking with refreshing candour, says it is far from a downbeat situation. He said: “We are where we expected to be.

“The previous year there was SSI and the coal plants like Ferrybridge were still operating.

“We already knew there would a drop in profits because customers have disappeared.

“SSI, for example, had a big impact on the North-East and had a big impact on us.

“But as far as the group is concerned, we have a very strong balance sheet and at the end of the year we will be virtually debt free.

“Hargreaves is a very solid business and we are in a really good place.

“It is a credit to the team that they steered the business through what had been a hugely challenging time.

“They have done a great job and it is now about how we go forward.”

Mr Banham reiterated coal was not yet done, saying speciality markets are providing a strong area for trade.

Indeed, sales of such coal hit 329,000 tonnes in the first half of the company’s financial year, which it says were very much in line with expectations.

“Steam railways are being pumped by Hargreaves coal and the bags on petrol forecourts come from Hargreaves”, said Mr Banham, who revealed money from coal operations will be spent on the firm’s wider expansion.

“Coal will still be a part of the business; it will be a cash cow for a long time to come.”

However, if Hargreaves’ commitment to coal will endure, so will something else – its NorthEast roots.

Mr Banham says the firm’s head office, on Esh Winning’s West Terrace, is a proud base and one of immense importance.

He said: “We are a North-East plc and are very proud of that.

“The North-East needs plcs headquartered here and it’s important for bringing quality jobs into the region.

“We are a North-East company and are going to stay in the North-East, it is where our heart belongs.”

That continued presence will come through a number of areas, with transport, land and civil engineering operations complementing lingering coal provision.

Hargreaves previously bought Essex’s CA Blackwell Group to extend into civil engineering, with the latter’s order book featuring such stellar projects as the Channel Tunnel rail link and Heathrow’s Terminal 5.

Its land division has submitted plans for up to 1,600 homes in Blindwells, Scotland, while its energy arm aims to transform the former Westfield opencast coal mine in Fife into a renewable energy hub.

Mr Banham said: “Our transport division used to have 40 per cent coal butis now focused on waste-to-energy plants.

“We think Blackwell is very good too.

“We used to move soil to get to coal; Blackwell moves soil to create a platform to put roads and railways in.

“There are real possibilities to grow.”

By referring to expansion, Mr Banham allows himself to return his gaze to the NorthEast, saying the benefits of any evolution would start in this region.

He speaks with passion when he talks about the area, particularly when he moves onto the subject of providing opportunities for the next generation.

Things have changed and there’s little point looking back, he says.

He added: “There are real possibilities to grow; we have got the money and the people.

“It is all about making sure this company stays a NorthEast plc and delivers value to the region.

“It is not all about low level service jobs, the last thing we want is more Costa coffeeshops and low-paid jobs.

“We need quality for our children so they have a long-term future and we are redoubling efforts on jobs.

“We will continue to develop and add people to the business that are going to help the North-East economy thrive.

“It is an exciting time for young people to be part of Hargreaves.

“The group has gone through some turbulent times, where people like SSI and UK Coal have gone.

“It’s my job to ensure Hargreaves has a long-term sustainable future.

“We’ve got that in spades.”