Advance buying by customers of raw materials ahead of the end of the Brexit transition had a “significant impact” on the performance of Co Down steel supplier Walter Watson, which reported profits up by £1.1m last year.
Walter Watson is the largest family-owned structural steel fabricator on the island of Ireland.
Both the pandemic and Brexit have thrown up challenges and, while it is not yet clear what the full impact of both will be, the company believes they can be managed.
Turnover was slightly down to just over £52m, but the company posted a profit of £4.2m for the year to the end of December 2020, according to the firm’s annual report.
The Castlewellan-headquartered firm employs 230 people here, in Co Kildare and in Scotland.
It has supplied steel for many projects across the UK and Ireland, including most recently the Southern Regional College in Armagh, the new Green Pastures Church in Ballymena, and Dairy Hall Leisure Centre in Newtownards.
Covid-19 brought “an unprecedented level of market volatility and economic uncertainty” to the steel industry, but the company reports that it has managed to deal with the impact of the pandemic without encountering any major difficulties.
However, the future is unclear as the global picture remains fluid, the company added. Brexit and the introduction of the protocol have been challenging, particularly in relation to price rises for materials, demand and navigating customs.
“The group has put in place appropriate measures to give us confidence that we are well positioned to manage these changes,” the company reports.
“We hold strong supplier and customer relationships to work through the initial implementation period.”
Quotas introduced by both the European Union and the UK has led to an increase in prices over the last six months to the end of June.
Steel mills are experiencing higher raw material costs while demand is high, further pushing prices up.
The company said it is closely monitoring the impact of the pandemic but added that “it is encouraging to note that quality projects continue to come to the market”.
“The group’s pipeline of opportunities remains healthy, which reflects the group’s standing in the UK and Irish markets,” the firm said.
It added that its order book is “extremely strong” and “further significant contracts” were secured this year.
“Planned procurement and forward buying of raw materials had a significant positive influence, in what proved to be a very competitive procurement marketplace.”
The company, which also makes cranes and agricultural equipment, paid £6.9m in wages and salaries in 2020, down from £7.3m the previous year.
Key management received compensation of just over £353,000.
It reported debts at the end of the year of a little over £11m, while total net assets were approximately £31m.
The company operates five divisions: structural steel, agricultural, reinforcement, overhead travelling cranes, and steel stockholding.
It designs, manufactures and distributes steel, as well as carrying out out all-stage building of projects.