US-based heat exchanger tubing and components manufacturer Turbotec Products has sorted out its litigation and it can concentrate consolidating production at a new site in Hickory, North Carolina.
Former majority shareholder Thermodynetics claimed that it should be paid a dividend as well as an administration fee for the year to March 2007. The judge did not agree. Turbotec was awarded “substantial costs” and Thermodynetics has paid £350,000 on account with more to come.
Turbotec’s revenues in the year to March 2010 were hit by lower copper and nickel prices. Revenues fell from $27m to $19.8m and gross profit declined from $7.51m to $5.45m. Overheads were reduced so the decline in pre-tax profit was partially mitigated and it fell from $2.38m to $1.21m. That was a particularly good outcome considering the costs of the litigation.
Most of Turbotec’s markets have been declining but there are opportunities in high efficiency boilers, geothermal heat pumps and solar products.
Net cash was $1.3m at the end of March 2010. The new facility will cost between $5m and $5.5m to kit out. The litigation money will help but nearly all the spending will be in this financial year.
At 33.5p a share, Turbotec is valued at £4.29m. The share price has risen by two-fifths in the past year.
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