CONSTRUCTION machinery maker Komatsu said some recovery in the market has led to a £60m-plus jump in sales and a need for more staff on its North East production lines.

The Japanese company, which has a UK base at Birtley, Gateshead, employing almost 400 people, said turnover was up to £176m for the 12 months to March 31 this year from £114.5m 12 months earlier.

Komatsu is the world’s second- biggest earth-moving equipment maker after US giant Caterpillar, which employs more than 1,000 staff in Peterlee.

Caterpillar recently posted worldwide record second quarter sales of £17bn and profits up 67% to £1bn whereas Komatsu’s most recent worldwide results revealed a 4.9% drop in first quarter sales to £3.7bn.

Despite the UK operation’s increase in turnover, pre-tax profits declined to £5m from £8m the year before due to an increased cost of sales driven in the most part by poor exchange rates and hefty steel prices.

On its European performance, the company said: “In the two years to March 2010, the company significantly adjusted its cost structure in order to mitigate the impact of reduced sales, which resulted from the severe economic downturn in Europe.

“In the year to March 2011, there was some recovery in the market situation, which prompted a small improvement in the company’s sales.

“Sales have further recovered in the year to March 2012.