Xaar moves to Scandinavia
Article Date: Oct 17 2001Xaar, the Cambridge-based ink jet printing technology group, is moving all of its UK 'print head' production to Sweden after problems hampered production in the Fens, writes Ben Cobley.
Fully listed Xaar's (XAR) move will cost about £1 million in exceptional charges in addition to 45 jobs at the company's facility in Cambridge. To cope with its production increase in Sweden, 20 extra staff will be taken on at a plant near Stockholm, which has a five year history of production for the company and (at least initially) has the capacity to cope with the extra workload.
Finance director Gordon McLeod comments that Cambridge is not suitable to cope with high volume manufacture, while the highly automated Swedish facility is. But the move will hit current profits.
As a result of these problems, and house broker WestLB Panmure's decision to assume no extra licensees will be gained during the year, the market now expects Xaar's pre-tax profits (before the exceptional charges) to reach around £1 million for the full year. This represents a drastic cut from the previous forecast of £4 million pre-tax.
The shares fell 12 per cent to 71.5p on the day, giving the company a market value of £42.3 million.
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