Spring Ram shuts tile subsidiary: Underlying operating profits bounce out of the red as kitchen and bathroom sales revive

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The Independent Online
SPRING RAM has closed its Artisan Tile subsidiary, a poorly performing business that contributed to the collapse in the group's fortunes in the past two years. Roger Regan, chairman since last year, said: 'The board has considered the extended period of start-up losses and believes these are likely to be prolonged by intense international price competition.' Artisan made trading losses of pounds 7m in two years.

He said Artisan, set up in 1992, could not compete with Italian and Spanish manufacturers. An additional pounds 2.5m closure costs from asset write-downs will come from Artisan, which made bathroom and kitchen tiles.

Mr Regan said he hoped to find work elsewhere in the group for about a third of the 95-strong workforce.

The news of the closure came with Spring Ram's results for the six months to 2 July. It made a loss before tax of pounds 1.1m, sharply lower than the pre-tax figure of pounds 36.4m in the comparable period. Last year's results were depressed by exceptional costs. Spring Ram made underlying operating profits of pounds 2.2m at the halfway stage compared with a loss of pounds 4.8m.

Regency Doors, the group's most serious loss-maker, is expected to return profits in the second half of 1995 and the following year. Like Artisan, Regency was a greenfield start-up by Spring Ram's previous management.

Spring Ram's two older established businesses - the manufacture and supply of kitchens and bathrooms to retail outlets - improved profitability. Kitchens operating profits were pounds 6m, up from pounds 4.7m, while the bathrooms side made a profit of pounds 100,000 against losses of pounds 3.2m last time.

The loss per share was 0.3p (loss 10.4p) and there is no dividend.

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