Engineering company Darchem, which has a site in Stockton-on-Tees, increased its turnover by 20%, from around £62.8m to £75.4m, in the year ending October 26, 2012.
The firm, which will opening a new £8m 75,000 sq ft factory in Stillington next year, also boosted profit after tax from around £11.8m to £13.7m, new financial statements show.
Darchem Engineering Ltd, which is registered in Edinburgh, operates predominately in the aerospace sector, providing products and services specifically designed to meet customers’ need for high-temperature insulations systems and complex fabrications.
In its four business units, much of its work involves computer-aided design techniques, software and its on-site fire-testing facilities.
A directors’ report with the new financial statements says: “Turnover increased by 20% during the year as the commercial aerospace industry continued to increase production rates, underwent some retrofit programmes on the existing fleet and introduced new products to market.
“In addition, we achieved some revenue recognition on the first of the new aircraft carriers being built for the UK MOD.
“The oil and gas market continues to operate at reasonable levels.
“We also saw an improvement in the year in the our supplies to the construction vehicle market.”
Operating profit rose around 12.2% from around £16.1m to £18.1m.
It did not grow in line with turnover because the company incurred costs as it positioned itself to win fabrication work from the potential new build of nuclear power stations in the UK.
“Unfortunately, the time-scales for this work continue to slip as the electricity generators continue to negotiate with the Government over tariffs,” the report says.
The average number of employees, meanwhile, went from 723 in 2011, to 814 in 2012 – a growth of 12.7%.
Total staff costs went from around £22.8m to around £26.1m, and the highest-paid director received emoluments of £274,000, with the company also contributing £38,000 to his pension.
As to the future, the report says: “We are entering 2013 with a strong order book.
“In addition, the timing of revenue recognition on large projects indicates that turnover will exceed 2012 levels and that this will sustain profitability and employment levels.
“The availability of credit for our customers remains an issue and we are again seeing signs of weakness in the construction vehicle market.
“Fortunately, this market represents a small percentage of our total business.”
The 54-year-old firm’s new Teesside factory will likely see the creation of at least 86 jobs and the safeguarding of a further 29.
The investment, driven by a growing market for large scale nuclear fabrications and supported by a £1m grant from the Government’s Regional Growth Fund, has seen Darchem Engineering’s parent company, the Esterline Corporation, invest the remaining £7m in the plant.