Oregon Timber makes £22k profit even as its sales fall by a quarter

OREGON Timber, the Borders-based house-frame manufacturer, has carved out a modest profit, despite a further sharp fall in sales.

The company, which has been hit hard by the downturn in the housebuilding and construction sectors, made a profit before tax of just under 22,000 in the year to 31 December, newly-filed annual accounts reveal. That compares with losses of more than 81,000 in 2008.

The Companies House documents show that turnover during the year fell by 26 per cent to 8.8 million.

Three years ago, the Selkirk-based firm was generating record annual sales of almost 20m and had a medium-term goal to build turnover up to 45m.

The dramatic turnaround in the fortunes of the housebuilding industry meant the business was forced to downsize and shed jobs. Much of its growth had come from major housebuilders south of the Border.

The latest set of accounts also expose an operating loss of almost 60,000 in 2009, although "financial adjustments", chiefly the sale of the company's former premises in Jedburgh, enabled Oregon to move into the black at the bottom line.

The managing director, David Maxwell, said an "element of stability" was apparent later in the year, allowing the group to maintain "core staff and skills". That had put it in a "strong position to resume growth as the housing market recovers", Maxwell added.

"The team at Oregon has been successful in managing the effects of a severe market downturn on our business," he said. "As a result, we are financially stable and well placed to service our customers as part of a safe, reliable supply chain."

Despite the slump in turnover, "close financial management" meant the group increased the cash on its balance sheet by almost 1m, to 1.5m.

According to the annual report, staff numbers fell from 76 to 54. In early 2007, Oregon had been hopeful of creating scores of jobs on the back of the 2007 expansion plans.

The company, set up in 1998, rose from the ashes of a local house-builder following a buyout from its receivers. It relocated to its present home from Jedburgh in 2005.

Oregon's accounts also showed total directors' pay falling from some 316,000 to 202,000. The highest-paid director received 74,000, down from 77,000.