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Cookson Group Plc (CKSN), the world's biggest maker of ceramic linings for steel smelters, posted a full-year profit as steel production increased and the company moved jobs to lower-cost countries.
Net income was 62.9 million pounds ($121 million), or 32.6 pence a share, after a year-earlier loss of 11 million pounds, or 5.8 pence, a year earlier, the London-based company said today. Sales gained 1.6 percent to 1.63 billion pounds.
Chief Executive Officer Nick Salmon has invested in new factories in Poland, Mexico and China to replace higher-cost plants in Britain. The U.K. company said today it's more than halfway through a program of factory closures and job cuts in its home market as stems five years of losses.
``We have to do just-in-time manufacturing close to our markets,'' Salmon said in an interview. ``Asia is suddenly 23 percent of revenue and almost half of profits, so it's good that our employee count is up 66 percent in Asia.''
Shares of Cookson fell as much as 26 pence, or 4.2 percent, to 600.5 pence, to close at 601 London. The stock has gained 14 percent in the last six months, giving the company a market value of 1.19 billion pounds.
Profit at Cookson's ceramics unit will equal 13 percent of sales in 2008, compared with a margin of 11.8 percent last year, the company said today. The division, Cookson's largest, had an ``outstanding'' year as global steel production rose by 9 percent, Cookson said.
The electronics division, which provides solder for circuit- board makers, incurred higher costs as it replaced traditional lead-tin solders with more environmentally friendly versions that have greater silver content. The higher costs were passed on to customers, Salmon said.
Cookson's precious metals division, which supplies materials and components to jewelry makers, showed a 41 percent increase in profit as production moved to areas with lower labor costs, including Thailand.
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