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Pre-tax profits fall at Burneside paper firm
ONE of South Lakeland’s biggest companies is hoping to revive its fortunes after a challenging year in which pre-tax profit fell by more than half.
Paper and materials group James Cropper, based in Burneside, saw the surplus figure plummet from £1,694,000 to £843,000 between April 2011 and 2012.
Annual turnover was also down by six per cent, from £83.3 million to £78.2 million.
The 167-year-old company admitted the dwindling figures reflected the need for restructuring against the ‘backdrop of a challenging economic climate’ Chairman Mark Cropper said: “Troubles in the Euro-zone economy are a particular challenge and the weakening US dollar had an adverse impact on the ster-ling value of our technical fibre products.”
Although earnings numbers for the group’s speciality papers appeared positive — with the return more than doubling — turnover actually decreased by three per cent.
John Denman, group finance director, said: “The saving grace was the fact that while turnover went down in this sector, costs, particularly of wood pulp, went down with it.”
But Mr Denman said the firm was now looking to the future.
“We can do little to influence the world economy so we are using our initiative and have embarked on a significant restructuring process.”
Part of this has included a ‘change in working pract-ice’, which led to an eight per cent reduction of the 500-strong workforce earlier in the year.
This loss of 40 jobs, which has cost £800,000 in redun-dancy payouts, is expected to save the firm £1 million per year.
Mr Cropper added: “I am confident that our competitiveness will improve over the coming year as a consequence of our specialist capabilities, products and excellent service levels coupled with our recent investments and the restructuring process.”
James Cropper plc began making paper products at Burneside in 1845.