SPECIALITY chemical company Thomas Swan has returned to profit after three loss-making years as sales surged ahead by 20% on the strength of strong demand in Asia and the Far East.
The Consett-based company has begun recruiting again, taking on an additional 14 staff in the past few months with total UK employee numbers now 138.
Managing director Harry Swan, great-grandson of the company founder, says it is continuing to invest in developing the business both at home and abroad.
Pre-tax profit for the year ending March 2010 came in at £1.2m with revenues up 20% from £17.5m to £21m.
This followed three years of losses and was boosted with a £400,000 deferred payment from the sale of its Bio Dynamics Research division in February 2008.
Mr Swan said: “We are encouraged by our recent performance but the focus has now moved to sustaining profitability going forward.
“The trading environment remains extremely volatile with significant pressure on energy and raw material prices which is proving challenging.
“We are cautiously optimistic that the current year will show a stable performance and we are continuing to invest in the growth of our business in the UK and abroad.”
Swan’s has three main divisions: performance chemicals, which are a range of products it makes for industry; custom manufacturing; and advanced materials.
Swan’s products are used in a number of common applications. Its ink resins are used in chocolate bar wrappers or food packaging to stick the ends together without using heat which can damage the food. And its biocides are used in disinfectants.
Mr Swan added: “We had a strong 2009/20101 and we are continuing to perform strongly in most product areas with demands driven by strong demand from Asia and the Far East.
“We have been supported by a fantastic performance from our staff and have been able to recruit new employees on the strength of our improved performance.”
The company says it is looking to grow through internal growth and acquisition although Mr Swan was not prepared to elaborate on any possible future purchases.
The company is well-placed to make further acquisitions with cash reserves increasing by £1.1m through the sale of an investment property.
Its net assets increased in the last year to £10.6m. Mr Swan says the company has no bank borrowing and has healthy cash reserves.
“We like to be masters of our own destiny. We are in a healthy position, with cash in the bank.”
The company exports more than 80% of its products. It manufactures more than 100 performance and speciality chemicals and exports to more than 80 countries.
It has a strong presence in the United States where it employs more than 50 sales staff and it recently opened an office in China.