HEATING appliance manufacturer Rettig UK has slipped into the red but the company said it is continuing to invest heavily in its Gateshead headquarters.
Figures released for the year to the end of December 2011 show that Rettig, which trades under the Myson brand, saw a slight fall in turnover to £69.5m from £72m in 2010.
But the business, which employs more than 320 staff on Team Valley made an overall loss of £659,000 loss for 2011, compared to a £1.6m profit in 2010.
The firm said it had faced administrative costs of £3.5m and did not have the benefit of exceptional credits, unlike the previous year when it received £1.12m.
Its annual financial report said: “Trading conditions remained extremely tough throughout 2011 with further reductions in the overall market for the company’s products.”
A company spokesman added: “The company remained cash positive in the last year; the accounts showed the usual large depreciation charge which reflects the serious investment in the business in previous years. This investment is in fact continuing with new equipment being purchased for the Gateshead factory in 2012.
“The company continues to be a major employer in the North East of England, with a strong balance sheet.”
Myson manufactures a range of Rettig heating appliances from the Team Valley, including valves, controls, decorative radiators, towel rails and under floor heating.
The business has further diversified its products this year as it looks at ways to stay ahead of its competitors in what it said is an “extremely price sensitive” market. It also suffered in the first half of the year from rising raw material costs, which stabilised in the second half.
The Myson spokesman said: “As a result of the investments, the factory in Gateshead is now producing modern, innovative products that have an increasing share of the UK heating market, particularly in our core business of panel radiators.
“We have also developed new products, such as the iVector fan convector, which are performing strongly, particularly in the commercial arena. Our pricing of these products reflects the competitiveness of the market and the margins necessary to maintain market position.”
He pointed to the ongoing issues in the housing market, which has a knock-on effect on companies like Myson.
“We have continued to improve cost management and service levels, as the whole market faces ongoing tough trading conditions, notably in relation to the performance of the housing sector,” said the spokesman.
“Government policy is now directed at stimulating housing activity – if it is successful we are optimistic that strong sales will follow.”