Company Snapshot: Acheson & Glover Ltd
Acheson and Glover Group became the holding company for four different companies from March 1, 2008. It now consolidates the results for Acheson & Glover, Acheson & Glover Precast, Acheson & Glover (Ireland), and Regrow.
The process of acquisition and restructuring had a major impact on the financial reporting for the recent two years.
The registered offices for the group are based in Fivemiletown, although it operates from several locations in mid-Ulster. The principal of the group include quarrying and the manufacture of bricks, blocks, limestone aggregates, granulated lime, ready-mixed concrete, manholes, hollowcore flooring, and pre-cast concrete products.
During the last decade the business has enjoyed a period of successful growth of turnover, although operating profit margins fell in 2007-8 and 2008-9. Turnover has doubled in the last five years. However, in the two most recent years, an operating loss was reported. Only since August 2007 do the trading results include the figures for Acheson & Glover Precast and Acheson & Glover (Ireland).
Trading results were affected by the impact of the economic recession. The group took various cost-saving initiatives, including a reduction in the number of employees and the closure of manufacturing plants in Blessington and Wells.
Pre-tax results in 2008-9 were hit by large exceptional costs. Charges of £4.9m were attributed to the profit and loss account, of which £4m was linked to the revaluation and impairment of fixed assets, and £900,000 to the deficit on the pension scheme. Further charges of £900,000 arose from redundancy costs and losses on the disposal of fixed assets.
In total, the combination of exceptional costs of £5.8m and net interest payments of £10.2m resulted in an unusually large pre-tax loss in 2008-9 of £20.8m.
In 2007-8 the group purchased the Finlay Breton companies, costing over £33m, along with a major investment of over £12m in its own assets. As a result, at the end of that financial year, bank borrowing had increased by over £44m. The further restructuring in 2008-9 has been facilitated by another £10m increase in bank borrowing.
The impact on the balance sheet of the adverse profit results in 2008-9 was mainly to reduce the stated value of shareholders funds in the Group. This was partly offset by the addition of an unrealised surplus of £13m, recognised from a revaluation of assets.