Pre-tax profits have plunged by two-thirds at Telford manufacturing giant Ricoh UK Products, Insider can reveal. The company reported profits before tax of £4.5m, despite a bolstered turnover of more than £336m. Having closed its OPC drum manufacturing division, the company said the cessation of one of its toner divisions "remains a threat".
The company, which is wholly owned by Ricoh UK Holdings, specialises in producing printers, fax machines and copiers.
In the year to 31 March 2011, the company recorded a drop in pre-tax profit from £12.5m to £4.5m. Ricoh UK Products' directors' said its 2010 results had been returned with the "positive impact of the curtailment gain" resulting from modifications to its final salary pension scheme.
Once this has been accounted for, the 2011 profit is the more "favourable" of the two, said the company.
Despite the decline in profit, Ricoh UK Products produced a lifted turnover of £336.5m – an increase of more than £21m on its 2010 results.
Its OPC drum business was closed in April 2010 after a continued decline in sales.
New product introduction has also been halted in the company's black manufactured toner division as sales volumes have decreased. The termination of this business "remains a threat", Ricoh confirmed.
The company remained positive about its other operations, and said growth in areas such as its final assembly photocopier and production printing businesses would "ensure profitability is maintained".
Ricoh UK Products added that it would continue to expand its recycling business and would focus on protecting profits through cost base reduction activities.
Directors praised the company's "strong and healthy" balance sheet, which they said provides good support for any potential future investments. No interim dividend was paid out at the year-end.
Ricoh UK Products' ultimate parent company is Japan-based Ricoh Company. Ricoh paid a reported £10m for a decade-long sponsorship deal with Coventry City Football Club's stadium. The arena has taken the company's name since it opened in 2005.
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