Russia’s woes hurt Oxford Instruments

OXFOrD Instruments will slash 7pc of its workforce after plunging to a loss.

the embattled specialist tools firm has been struggling after russia, one of its key markets, was hit by financial sanctions over its military action in Ukraine.

Over the past year it fell into the red with a £9.7m loss, compared to a £24m profit the year before, despite sales ticking up to £385m from £360m.

now the group needs to make cost savings and will close six of its sites – including one in the UK – as well as laying off around 160 staff. the group will also cut bases in Germany, Japan, China and the United States.

the abingdon-based company wants to trim £8m from its cost base, a figure that is 20pc higher than its previous estimates.

earlier this year the group issued a profits warning, blaming russian sanctions for the loss of export licences. It also said that Japan, another crucial market, would be badly hit.

Yesterday Oxford Instruments said that the Japanese recovery had been slower than expected.

‘Progress was adversely impacted by weaker demand in Japan’, said chief executive Jonathan Flint.

‘Overall, we have had a challenging year,’ he said, adding that ‘ swift and decisive action to improve our business’ would help the firm return to growth.

the company was spun out of Oxford University in the 1960s and is credited with pioneering the world’s first super- conducting magnet, which led to the development of the MrI scanner.

But despite a huge run in its shares since 2009, the company has been beset by woes recently.

Shares have dropped by more than a quarter in the past 12 months, and yesterday slipped 84p or almost 8pc to close at 982p.

analyst Jo reedman at n+1 Singer said it was ‘concerning’ that the company has seen a slow start to the year.