Scapa chief attacks state of British manufacturing

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The Independent Online
David Dunn chief executive of Scapa, the paper rollers to industrial tape group, yesterday launched a stinging attack on the state of British manufacturing industry and said the company was considering a dual listing in the US.

The statement came as Scapa reported that the strong pound had held back full year profits.

The group, which makes more than 80 per cent of its sales overseas, said that adverse currency effects had shaved pounds 1.7m from pre-tax profits for the year to March which rose 7 per cent to pounds 66.5m.

Sales were flat at pounds 527m. Mr Dunn said that sterling continued at current levels it would hit the full year by pounds 3.2m.

Mr Dunn said that he would like to sell more of the group's products - which include roller covers to the paper industry and specialised industrial tape - in the UK, but that markets were not available.

"Manufacturing industry has been decimated in this country over the last few years. The UK is no longer a manufacturing force in the world," he said.

Mr Dunn added that the company did not rule out a dual listing in the US. "It is something we are thinking of in the longer term. It would broaden our investor base."

Mr Dunn's broadside follow similar comments from Peter Rowley, chairman at high-tech plastics group Victrex, which has been badly affected by the strong pound and which sells 97 per cent products abroad.

Profits at the technical tapes business rose from pounds 25.3m to pounds 30.2m, on sales up 4 per cent to pounds 273m. Mr Dunn said that he wanted to become a "worthy number two" to tapes business 3M, by doubling sales in three years.

An acquisition is likely this year. "The tapes market is growing at 5- 7 per cent a year and is worth $5bn. We have three to four per cent now and we want ten per cent."

Mr Dunn said that he had around pounds 60m available if the group doubled its gearing to around 60 per cent. "We would still be comfortably covered at four times."

Mr Dunn said that although the papermaking products business had been affected by lower tonnage of paper - profits were flat at pounds 46m on sales down from pounds 262m to pounds 253m - there were signs of a pickup and order books were "strong". The group's shares rose 15.5p to 214p.

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