The Company continues to demonstrate its commitment to the UK engineering and construction sectors through investment in new facilities and equipment. The capital programme for the year to 30 September 2008 includes a series of major projects all with the objective of providing a better and more effective source of supply to all our customers.
On 1 October 2007 the Company acquired the business of Steel Supplies (Scotland) Limited based south of Aberdeen and primarily serving the oil industry in the region. Plans are also in hand to move Thistle Steel Limited to significantly larger premises during 2008. These developments will improve our service to our customers in Scotland.
During the year the Company has expanded into a warehouse in the West Midlands adjacent to the laser tube cutting facility. Commissioning has already started on a new Jumbo laser which has been installed in this warehouse. This machine will have the capacity to laser cut large hollow sections that are used in structural applications and increasingly in architectural “statement” buildings.
The Company continues to develop its environmental policy and as part of the programme of capital investment it is ensuring that the investment is made in efficient equipment seeking to minimize the environmental impact of the Company’s activities. In addition whilst maintaining a “user chooser” policy, the Company continues to encourage employees to move towards ever more fuel efficient vehicles and to make use of alternative forms of transport where possible.
During the latter part of 2007 there has been evidence of increased competition and there are signs that prices in certain product ranges may be easing. The UK market appears to be hesitant in the faced of the well publicised potential credit crisis. However until there is clarity in the markets it may be anticipated that customers will be hesitant in committing to new developments., a reaction that is likely to have an impact on the structural steel market. In contrast, enquiries from engineering based customers who are serving the oil industry remain healthy. In the short term we expect modest fluctuations in producer prices and a very competitive market amongst stockists while demand is restricted to modest growth.