CO Antrim car components manufacturer Schrader Electronics became one of the north’s most profitable businesses during 2018, a year in which it shed more than 200 production jobs.
New accounts filed with Companies House by the Carrickfergus and Antrim based firm, show its pre-tax profits rose 7.4 per cent to $95.4 million (£73.5m) during the 12 months to December 31 2018.
Just three other companies in Northern Ireland were more profitable in the same period.
Set up in 1988, Schrader Electronics has been owned by the Sensata Group since October 2014. Although domiciled in the UK, the parent group does most of its business in the US and a result, publishes its accounts in US dollars.
The rise in profits came despite a 2.5 per cent decline in turnover to $418.9m (£322.6m) in 2018.
According to the report, Schrader Electronics’ workforce fell to 1,198 in 2018, some 189 below its 2017 figure. The biggest cut came in production, which dropped by 216 to 744. The decline was offset by an increase in 26 administration staff.
In February 2018, Schrader announced plans to cut 125 jobs at its operation in Carrickfergus, blaming a drop in demand for some of the products its makes in Northern Ireland.
Those products include tyre pressure monitors and other sensor equipment.
In a strategic report accompanying the accounts, the directors of Schrader Electronics, acknowledged the global decline in car sales.
Worldwide car and light vehicle sales shrank by 0.5 per cent to 86 million vehicles last year, the first fall in volumes since 2009.
A geographical analysis by Schrader Electronic of its global turnover showed that while revenues derived from the US increased by $40m (£30m) to $214.3m (£162.7m) in 2018, sales to Europe and the rest of the world fell/
In the case of the ‘rest of the world’, revenues were virtually slashed in half from $107.4m (£81.5) to $56.2m (£42.6m).
“Many of the car markers felt the effects of trade tensions ad tariff introductions between the US and China, and political changes in key markets, driven by Brexit and complex environmental regulations,” states the firm’s strategic report.
The directors said the result was “a great deal of uncertainty”, adding: “The outlook for 2019 is for further stagnation in the US market, continued decline in Europe due to political uncertainties and further softening in the China market in the face of increasing tariffs between the US and China.
“Globally, sales are forecast to decline by four million vehicles.”
Despite declining sales, Schrader managed to cut its costs by three per cent in 2018, improving the company’s gross margin to 33 per cent.
According to the directors, the savings came from a combination of increased productivity and a reduction in the purchasing price of components. Distribution costs also fell by almost $3m (£2.3m) due to a reduction in freight and warehousing costs.
The report also notes that Schrader Electronics increased its expenditure on research and development during 2018 from $23.7m (£18m) to $26.4m (£20m).
