Manufacturer of components for burglar alarm systems, Scantronic Plc, has seen interim profitability rise sharply due to its cost-cutting programme, which has shown particular benefits in the US. Pre-tax profits rose 38.8% to ?1.5m, while turnover rose 10.2% to ?18.5m. Chairman Chris Brookes said that sales at his Perivale, Middlesex-based company had grown despite the […]
Manufacturer of components for burglar alarm systems, Scantronic Plc, has seen interim profitability rise sharply due to its cost-cutting programme, which has shown particular benefits in the US. Pre-tax profits rose 38.8% to ?1.5m, while turnover rose 10.2% to ?18.5m. Chairman Chris Brookes said that sales at his Perivale, Middlesex-based company had grown despite the poor economic climate because it has an established name that people can recognise. The ailing US division has substantially improved its performance after consolidation of its operations into one site in Stockton, California. The manufacturing operations in Costa Rica and New Jersey have been closed. Losses fell to ?15,000 from ?354,000 this time last year, and the division is expected to break even by the year-end. However, sales dropped to ?4m from ?5.3m, because the US operations are now selling three quarters of their products to the European division, based in the UK, rather than directly to customers in Europe. A corresponding increase in revenues was recorded at the UK branch; sales grew to ?14.6m from ?11.5m. The US division reduced bank and intergroup debt by $1.3m during the period by reducing raw materials and finished goods stocks. Further reductions are planned for the second half. As from April 1993, Scantronic will reorganise its existing European activities into two divisions. One will deal solely with the UK, and the other will be responsible for sales and marketing in continental Europe. Scantronic International Ltd will concentrate on the French marketplace initially, as the company already has an established position there and technology in the country is reportedly akin to that of the UK. Scantronic has three main product areas; wireless security systems, sold into both the domestic and industrial marketplaces; detectors, which in the UK are now sold by a separate Arrowhead sales unit, set up at the end of August to try and capitalise on the well-known name; and control systems for burglar alarms, which is still the core business. The group’s budget range of control panels provided solid sales growth, particularly in the domestic market, but eventually will be replaced by a new Mosaic range, to be launched sometime between March and May of next year. This business was boosted by an increase in volume sales to OEM customers, such as Modern Alarms, ADT, and Legrande in France.