The Courier & Advertiser (Fife Edition)
Havelock Europa CEO resigns after £2.6m loss
OUTFITTER: Kirkcaldy company’s chairman has optimism for a better 2018
The chief executive of Fife interiors outfitter Havelock Europa has resigned as the company announced a large loss in the first six months of the year.
The Kirkcaldy-based manufacturer saw a pre-tax loss of £2.6 million between January and June compared with an £868,000 loss for the same period a year ago.
CEO David Ritchie, who has been in post since May 2015, resigned with immediate effect to “pursue other business interests”. He has been succeeded by Shaun Ormrod.
The company’s shares fell 14.58% to close at 5.12p last night.
The interim results show that revenue over the six-month period decreased by 9% to £23.2m, compared with £25.4m last year.
Havelock Europa said its lower revenues were a result of a weaker order book, in part “reflecting increased market uncertainty since mid-2016”.
The company is one of Fife’s biggest private sector employers, with more than 300 staff based at John Smith Business Park in Kirkcaldy.
Chairman Ian Godden has provided £600,000 of funding since joining in January this year – £300,000 via an issue of new shares and £300,000 through an unsecured loan.
He said he expected the second half of the year to be profitable and had “cautious optimism” for 2018.
“The expectation of a profitable second half will not return us to good results,” he said.
“They will be significantly below last year. We have cautious optimism for 2018. Our quoteback, which is the amount of work we have a right to bid on, has more than doubled in the last three months.
“Our retail and lifestyle business has had a good first half and our international sales have been encouraging this year.
“Finally, the UK financial institutions, two in particular, are looking for strong programmes from 2018-19.”
Mr Borland said the company intended to invest in machinery for the Kirkcaldy factory.
“A lot of the heavy lifting of restructuring the company has been done,” he added.
“In Kirkcaldy in the manufacturing there is a need for new equipment and new capabilities.”
The update comes three weeks after a company warning that this year’s results would fall “significantly below expectations”.
Havelock’s net debt has increased to £5m from £3.6m a year ago.
The firm’s bank overdraft facility was increased from £4.75m to £6m in May.
A comprehensive review of strategy has been carried out over the last six months, with the results of this due to be announced at the end of next month.