After two years of heavy losses, Tanfield says that Snorkel's order intake increased “substantially” in the first quarter of 2011, indicating that a recovery may be underway.
However, as some of these orders are short term replenishment of inventory at dealers, it is too early to say whether the current levels will be sustained, the company added.
Tanfield added that its ability to respond to this sudden spike in demand is hampered by the fact that its supply chain's ability to respond was damaged by the severity of the recession, and so 2011 may be another loss making year. “We see this year as one of transition, where we grow sales and move closer towards profitability,” the company said.
Turnover in 2010 was barely any better than 2009, up less than 1% to £43.5m. Pre-tax loss was £16.7m, following a loss of £16.9m in 2009. Operating loss before impairments was £15.8m (2009: £16.0m).
These results do not include sales from the Zero Emission Vehicles division, which was sold at the end of 2010 to associate company Smith Electric Vehicles US, and is therefore treated as a discontinued operation.
Chairman Jon Pither said: "2010 was equally as challenging as 2009, with no material improvement in demand for aerial work platforms. However we have since successfully completed the sale of Smith Electric Vehicles, to our associate company Smith Electric Vehicles US, which has positively impacted on our net cash position and we remain debt-free.
“We have stuck to our guns in terms of preserving our people and core skills for the longer term recovery, rather than chasing inappropriate short term reductions in overhead, and we continue to enhance and expand the Snorkel product range and distribution channels.
“As the market for aerial lifts is now beginning to return to growth, we expect that 2011 will be a transitional year, where we move closer to a break-even position. With a healthy cash balance and no debt, I believe Tanfield is on the right path to recovery and a secure future."
Having preserved debt capacity for this eventual recovery, the company is now examining the potential to introduce some debt into the business to help finance a return to growth.
Tanfield is one of the big four global producers of mobile elevating work platforms. During 2010 the UpRight brand, which it used in Europe and the Middle East, was subsumed into the Snorkel brand (acquired by Tanfield in 2007) that is better known in other parts of the world. Tanfield’s entire powered access business division now operates globally under the Snorkel brand.
Snorkel has production facilities in the UK, North America, New Zealand and a joint venture in China.
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