Investment triggers rapid growth at Ashington seal manufacturer

Heavy investment at seal manufacturer Arefco is set to steer the business to turnover of £11m within two years

Seal manufacturer Arefco takes delivery of the £400,000 Romi machine
Seal manufacturer Arefco takes delivery of the £400,000 Romi machine

A Northumberland seal manufacturer is targeting a 70% sales increase within two years after making a £400,000 investment in new machinery, drawing attention from overseas customers.

Established in Ashington in1978, Arefco provides sealing systems to most of the major drilling equipment manufacturers around the world, serving customers in the industrial, renewable energy, aerospace and defence and oil and gas sectors.

The firm, which became part of the UTEX Industries corporation in 2011, has featured in the Top 50 fastest growing firms in the North East for the last three years and recent years has seen rapid revenue growth.

Employing 58 people, the business saw sales rise by a fifth in the last two years, with the company recording turnover of £3m in 2010, with that more than doubling to £6.5m by 2013.

Now the firm has taken delivery of a unique machine from manufacturers Romi which will significantly up production rates, and new work following the introduction of the investment is estimated to take turnover to £11m by 2016.

High pressure conditions within industrial sectors mean a lot of seals have metal elements bonded to them to prevent corrosion, and the new machine is capable of milling, boring and drilling metal while also increasing the size of the products the firm can now produce, opening up the firm to new clients in emerging oil and gas markets as well as those in the fracking industry.

Alison Stewart, UK and European sales manager, said: “It really is a unique piece of machinery and we hhad a handover ceremony with the manufacturer when it arrived.

“What we do is very involved – we are not a manufacturer of standard seals, but are involved at the technical design level and create solutions to extend the life of products. A very large proportion of our business is in the US and we have a very global approach, with contracts in the States, the Middle East, central Europe and Aberdeen.”

Shale gas fracking activity in Western Australia, as well as a growing oil and gas market in the country, has also put the business firmly under the gaze of Australian firms too. The business believes that, in time, it should start to see revenues coming in from the UK fracking industry too, but for now it is working with overseas clients within the controversial industry sector.

Stewart said: “It’s an industry that’s tinged with negativity at the moment, so it’s a few years off for the UK market but there is lots in development, in the States and Perth, Australia. We’ve seen fantastic growth of 20% year-on-year so the infrastructure internally is changing. New people are coming on board and it is an exciting time for us. We have a big agenda going forward.”

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