During the year the company invested over £7.7 million in fixed assets, both in the replacement of plant and machinery and delivery vehicles but also in new equipment to enhance and develop the Group’s processing capability.
The two largest developments were at Omega Steel Limited in Scunthorpe and Newark Steel Limited. Omega Steel is a new company which has been established to provide state of the art processing facilities for the structural steel market. These services; cutting, drilling, shotblasting and painting can be offered nationwide through the group depot sales network.
The Gainsborough Steel Services Limited site has been closed during the year in preparation for its sale for redevelopment during 2008. The opportunity has been taken to consolidate the Gainsborough Steel stocks with those of Newark Steel, a business that has grown strongly in recent years. Newark Steel has now been moved to a much larger site at Balderton south east of Newark, close to the A1 trunk road. This depot also offers a comprehensive range of processing for structural steel sections. The business of Gainsborough Steel has moved to purpose built offices in the new Marshall’s Yard development in Gainsborough.
As reported last year, on 1 October 2005, the Company acquired Woodberry Chillcott Holdings Limited and its subsidiaries which operate primarily in the South West supplying steel and tools to the engineering industry. Regrettably it has taken much longer than expected to integrate this business into the Group and realise the benefits of the Group approach and systems. As a result the Board has concluded that it is appropriate to write off the remaining goodwill that was created on the acquisition of Woodberry. However the Group remains committed to the development of the business within the South West and is acquiring a further freehold property in Avonmouth into which the Woodberry Bristol business will be moved during 2008.