SCOTT & Fyfe the industrial textiles manufacturer founded in Victorian times, has returned to the black helped by its success in overseas markets.
The latest accounts for Tayport-based Scott & Fyfe show the business made £32,000 pre tax profit in the year to 31 December after two years of losses.
The employee-owned business, which produces specialised textiles used in sectors ranging from farming to oil and gas, increased sales by around 10 per cent to £11.8 million from £10.8m in the preceding year.
The accounts show the growth was powered by a 53% increase in export sales to £5.9m from £3.9m.
UK sales fell to £5.8m from £6.8m.
The accounts cover a period during which exporters benefited from the fall in the pound in the wake of the Brexit vote.
In his chairman’s statement John Lupton told shareholders: “2017 was a resurgent year for your company with positive outcomes on a number of fronts. Sales finished strongly in the final quarter.”
Mr Lupton noted the company had eliminated low margin business and improved manufacturing efficiencies.
It has felt the benefit of investing in products such as flame-retardant matting and in upgrading machinery to boost productivity.
Mr Lupton also noted the company achieved cost savings after completing a restructuring in 2016.
The improvement in trading at Scott & Fyfe will be noted by industry watchers in Scotland. It follows a long period during which the country’s once might textiles industry has been decimated in the face of fierce competition from overseas countries, in which production costs can be lower.
Mr Lupton paid tribute to textiles industry veteran Nick Kuennsberg who retired from the board in September after eight years as chairman.
He thanked Mr Kuennsberg for his tireless efforts in supporting and driving the business forward.
Mr Kuennsberg helped oversee a diversification process to make the firm less reliant on the old core markets of packaging and carpet production, in which conditions became tough.
Mr Lupton also highlighted his predecessor’s “pivotal role as the architect of employee ownership” at the firm.
Scott & Fyfe became employee-owned in 2012 after four generations under the ownership of the Tough family.
“There aren’t a lot of people wanting to buy textiles companies at the moment,” noted Mr Kuennsberg at the time. “They [the family] want the company to remain, and thrive, at Tayport. The last thing the family want is someone buying the customers, closing it down, and taking the business elsewhere.”
David Tough remains a director of the firm, which was founded in 1864 as a linen works that supplied sails to boats on the River Tay.
The company has faced challenges since moving into employee ownership.
In 2013 it cut headcount from 104 to 87, in response to “extremely difficult” trading conditions during that year.
The company lost £411,000 before tax in 2016 and £876,000 the preceding year.
The average monthly number of employees fell to 83 last year from 90 in 2016.
However, in the accounts Mr Lupton said board members were aware of the responsibility to ensure “this great Scottish company thrives as we are focused on driving growth and prosperity through innovation, continuous improvement and employee ownership”.
On its website Scott & Fyfe says employee ownership puts control in the hands of the people who know the firm best and who will be most committed to making it succeed
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