Rotherham engineering firm's sales growth defies challenging conditions
AESSEAL, one of Britain's most valuable engineering businesses, has achieved a 3.5 per cent rise in organic sales growth in spite of challenging market conditions in 2015.
The Rotherham-based company designs and makes seals for a wide range of global industries including oil and gas, food, water, mining and pharmaceuticals.
Group turnover rose 1 per cent after the effect of currency movements to £143m in the year to December 31 2015.
AESSEAL has recorded more of three decades of near constant growth under Mr Rea’s leadership.
Founder and MD Chris Rea said: “The growth in 2015 was built on hard work from a whole load of people. We just continue to go out in the world and find opportunities.Probably our biggest single growth last year was in Madagascar. That is a comment on how difficult it is.
“We have developed a business model to grow in the Middle East, we have had strong growth in North America, but we had a strong minus in Mexico as a result of the oil crunch.”
The group said reduced sales in the oil and gas industry were mostly responsible for a six per cent fall in earnings before interest, tax, depreciation and amortisation to £23.8m.
Mr Rea said that although the slump in oil prices had led to shelving of billions of dollars worth of projects, it has also opened doors for AESSEAL as companies consider changing suppliers. Mr Rea said AESSEAL is working hard to enter new sectors and sees big opportunities in the Internet of Things, the emerging sector of machine-to-machine communication.
AESSEAL continued to invest in 2015 and spent the equivalent of 7 per cent of turnover on new product development.
Its strong track record in innovation was recognised last month with another Queen’s Award, the 13th it has received since 1988.
Mr Rea said: “Without innovation, we would be suffering the same declines as everybody else.”
The group employs more than 1,650 people, including 680 in the UK and Ireland. It has 350 staff in Rotherham. The private equity house 3i has a minority stake in the business, one of its longest-held investments.