Swallowfield makes progress

Cosmetics and toiletries group Swallowfield delivered a satisfactory performance in the year, following major management changes. And, despite eurozone economic woes, it was the continent that accounted for a significant proportion of the 15 per cent rise in overseas revenues.

The company's manufacturing plants in the Czech Republic and China now each account for around 10 per cent of turnover. But, as the costs of manufacturing in and shipping from China "are increasing rapidly", it's not so surprising that Swallowfield is aiming to sell a lot more Chinese-made products locally. Management hopes that low-cost lipsticks and shower gels will maintain sales in depressed western markets, while better margins come from similar sales in new markets such as Latin America and South Africa. At the same time, automating production processes in the Czech Republic will reduce costs, while input costs such as aluminium may be close to a cyclical peak. The figures also benefited from lower net finance costs and a 19 per cent tax charge, which is down from 22 per cent last year.

Broker Smith & Williamson expects turnover of £58m for 2012 and pre-tax profit of £1.7m. Swedish activist investor Peter Gyllenhammar owns 30 per cent of the group's shares and Western Selection has 17 per cent.

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