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Manufacturer Ebac defaults on loan as challenges continue, new accounts show

2025-09-02 07:37:52 By

Challenging times at North East manufacturer Ebac have continued with the firm defaulting on a loan from a retirement fund, new accounts show.

The Durham business, which makes washing machines, dehumidifiers, water coolers and heat pumps, has published delayed accounts for 2023 which show the continuation of a “challenging” few years.

Recent years have seen Ebac investing heavily on new products, including domestic heat pumps suitable for the average UK home, and while the firm’s work on these products is beginning to bear fruit it has impacted profits, as well as its workforce, which was reduced from 254 to 188 as part of efforts to reduce its costs and boost performance.

Accounts for 2023 show turnover of £17.75m down 18% on previous year’s £21.7m, although its operating losses narrowed from £2.7m to £1.53m. The accounts showed administrative expenses were significantly reduced from £8.2m to £5.95m, reflecting its restructuring initiatives.

During the year the firm defaulted on a loan to the Trustees of Ebac Limited Retirement Benefit, a pension fund for founder John Elliott and family members, when it couldn’t make repayment on a loan of £1.57m. It said the company is in discussion with the trustees of the scheme to roll over and extend the loan repayment “however no agreement has been reached in relation to the proposal but the trustees have not indicated they will seek repayment of the loan before the end of the term of the loan”.

Within the accounts, founder John Elliott said the firm continued with its work on new product development, although the investments weakened its bottom line.

He said: “Despite a challenging market environment, the accounts for the year ending 2023 demonstrate an improvement in our financial performance compared to 2022. Although turnover is down our losses have reduced. This decrease was primarily attributable to necessary strategic changes.

“During 2023, we continued with product developments that are looking very positive. Our British-designed heat pumps and home ventilation and dehumidification systems have USP’s that are receiving strong interest from landlords, social housing organisations and national builders. These products also have synergy with our technology and market know how.

“While these products have not yet translated into revenue growth, we strongly believe they will deliver significant profits and will make Ebac a leader in energy-efficient and sustainable home solutions. We have spent more than £3m on these projects which has meant high borrowings and weakened our balance sheet.

“We are currently going through a re-financing process where the directors and some of the related party liabilities are going to be capitalised to stabilise and strengthen the balance sheet.”

Following publication of the 2023 accounts a spokesperson warned that results for 2024 will show a worsening if its financial position, but said that the family firm had put in millions of its own money to transform the company - a move which it said was already working in the new financial year.

The spokesperson for Ebac said: “Despite a challenging market, the accounts for the year ending 2023 demonstrate an improvement in our financial position compared to 2022. We expect our 2024 year to be our worst in terms of losses, due to huge investments in new products including a new line of heat pumps and loft ventilation systems.

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Cheshire's Packaging One doubles workforce having secured seven figure funding deal

Jobs have been created by family-run Packaging One following a seven-figure funding deal from NatWest and Royal Bank of Scotland. The provider of protective wrappings and boxes, among other products, intends to double its workforce to 80 people following the funding injection. Expansion into the firm's 44,000 sqft premises in Middlewich has given Packaging One increased manufacturing capabilities by about 70% amid a recently secured contract with an unnamed customer described as a 'global tech giant' for its patented MediaWrap product which is used for protecting trade-in and recycled mobile devices. Packaging One was set up in 2008 and is run by husband-and-wife team Ian and Emma Chesworth, who have more than 30 years' experience in the industry. The business' operations span the UK, Europe and USA Mr Chesworth, director of Packaging One, said: “The expansion is a huge step in our growth and development. Not only is it good for our business but we are proud to be able to contribute to our community by creating new jobs and employing local people.” Fellow director Mrs Chesworth added: "We have been working with the NatWest team for almost two decades. Over that time, they have partnered with us to support our business and helped us reach key milestones around our growth and expansion." Claire Morley, senior relationship manager at NatWest, said: “We are thrilled to support Ian, Emma and the Packaging One family as they begin a new chapter in their business development. As the UK’s biggest bank for small businesses, we work collaboratively with customers to understand their needs and help them find solutions to support their businesses as they grow.

Newcastle College launches £850k advanced manufacturing skills facility

Leaders from some of Tyneside's top manufacturing and engineering companies have attended the launch of Newcastle College's new Advanced Manufacturing Suite. Delegates from firms such as Siemens Energy, Baker Hughes and Shepherd Offshore were shown the newly kitted out facility at the college's Rye Hill Campus, where cutting edge technology including robotics, 3D modelling equipment and CNC machines have been brought in to train students who could go on to careers in advanced manufacturing. About 500 students per year are expected to pass through the facility, which upgraded existing classroom and workshop space at the college, under the direction of an employer advisory board. Newcastle College principal Jon Ridley said the move is in response to consultation with industry about future skills needs, and part of a wider investment strategy across city centre campus, its Aviation Academy at Newcastle International Airport and its Wallsend-based Energy Academy, where students are trained for subsea and renewable energy industries. The new Advanced Manufacturing Suite will also be used to upskill local workers. He said: "At Newcastle College our courses are designed in collaboration - we co-create - with employers. So where employers are talking about the kit and equipment that's needed - we go out and purchase that equipment. "The difference in being a student at Newcastle College and a student at sixth form or a university, is experiential. It's about practicing and honing the skills on the kit." The array of workshop equipment supplied by Mach Machine tools spans different sub-sectors of advanced manufacturing with the college hoping to turn out workforce-ready candidates who can use the type of machinery and systems found on the workshop floor at local employers. Learners will have the opportunity to program robotic arms of the kind found on production lines and get to grips with precision milling machines used by component manufacturers. Overall, the investment in the machinery together with building work and IT required alongside it is worth £3m. Mr Ridley said the suite is intended to blend theory and applied learning - breaking traditional barriers between classrooms and workshop. He added: "It's 100% for the region and that's the thing about Newcastle College, we do have a large number of 16-18 year-olds and there are about 13,000 students here per year. "Only about 6,500 of those are kids and the rest are adults, and of those adults you've got people looking to retrain, re-skill and up-skill to enhance their careers. So to meet the region's ambitions, facilities like this are going to be the engine of that ambition."

Rolls-Royce CEO's pay slashed by almost £10m despite huge rise in FTSE 100 shares

Tufan Erginbilgic, the CEO of Rolls-Royce, has experienced a significant reduction in his pay by nearly £10m, despite his successful turnaround of the FTSE 100 heavyweight. The Derby-based company's latest financial year saw Erginbilgic pocketing £4.1m, a stark contrast to the £13.6m he earned in the previous 12 months, as reported by City AM. His earlier remuneration was inflated by a £7.5m compensation for earnings lost from a former job. Another factor contributing to the drop was the decrease in Erginbilgic's annual incentive plan earnings, which fell from £4.6m to £2.5m. Rolls-Royce has now introduced a changed separate bonus and long-term incentive plan scheme for its CEO, with the first LTIP not due to vest until the end of 2026. In 2023, his hefty pay package placed him as the third highest earning FTSE 100 CEO, trailing only Astrazeneca's Pascal Soriot and Relx's Erix Engstrom. However, Erginbilgic's base salary did see an increase, rising from £875,000 to £1.1m over the year, with a further five per cent hike planned for 2025. A Rolls-Royce spokesperson said: “We delivered record results in 2024 thanks to our ongoing transformation, achieving our mid-term targets two years earlier than planned and enabling us to upgrade our guidance for 2028. It is in the interests of all stakeholders that such strong performance and progress is rewarded. UK companies must be able to attract excellent talent and reward them when they deliver.” The Turkish businessman joined Rolls-Royce in July 2022 and assumed his role at the start of 2023, following a two-decade stint at BP that ended in 2020. Since succeeding Warren East as Rolls-Royce's chief executive, Erginbilgic has seen the company's share price soar from approximately 150p to over 800p. A substantial portion of this surge occurred recently – jumping from around 610p to its current level – in the wake of the defence summit in London, where European leaders expressed their support for Ukraine and committed to increasing defence spending. At the culmination of February, City AM disclosed that Rolls-Royce had decided to restart dividend payments to its shareholders and announced a bold £1bn initiative for repurchasing shares after reporting annual profits that exceeded market forecasts. Rolls-Royce's CEO hailed for spearheading 'impressive progress'. In the company's annual report, remuneration committee chair Lord Jitesh Gadhia was quoted praising the leadership team's accomplishments: "Tufan Erginbilgic and the executive team have delivered continued improvement in performance levels with impressive progress made on the group's transformation, generating real value for shareholders." He elaborated on the future targets, saying, "Achievement of the medium-term guidance will take Rolls-Royce significantly beyond any previously achieved level of financial performance and we are on track to deliver the commitments ahead of schedule." Lord Gadhia also emphasised the importance of incentivising management: "We are determined to incentivise the management to build upon the progress made and maintain momentum."

Major manufacturer TT Electronics warns US tariffs 'could cast doubt' on trading ability

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Promotional products firm 4imprint reports 10% rise in profit

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Rolls-Royce shares could rocket 50% after stellar two-year rally, analysts claim

Analysts at Bank of America have predicted that shares in engineering behemoth Rolls-Royce could surge by an additional 50% following an already impressive two-year rally. On Friday, analyst Benjamin Heelan raised his price target from 830p to 1,150p, as reported by Bloomberg, which led to a mid-day share price increase of over three per cent, as reported by City AM. This news arrived just one day after the London-listed company reinstated dividend payouts for the first time since the pandemic and announced a £1bn share buyback scheme. The appointment of CEO Tufan Erginbilgic in January 2023 marked the start of a remarkable recovery for a company that was on the brink of bankruptcy during the Covid-19 crisis. A combination of soaring travel demand and escalating military expenditure worldwide has generated significant demand for Rolls' jet engines and defence technology. Heelan noted that the firm had reaped the benefits of robust deliveries, pricing, and an enhancement in the reliability of its engines. Travel demand has remained strong over the past year, with numerous airlines, including British Airways owner IAG, reporting record profits. On Tuesday, Prime Minister Sir Keir Starmer announced the largest increase in defence spending since the Cold War. From April 2027, it is set to rise to 2.5% of GDP, with a goal to reach 3% by the end of the parliament. Rolls-Royce is targeting profits of between £3.6bn and £3.9bn by 2028 and free cash flow of between £4.2bn and £4.5bn. Over the last 12 months, shares have risen by more than 100%.

Pearson Engineering works on robot mine sweeper being trialled by British Army

North East defence specialist Pearson Engineering has helped to develop a robot mine sweeper which is now being trialled by the British Army to clear explosives on the front lines. The Newcastle company, based in the famous Armstrong Works, has worked with the Defence Science and Technology Laboratory (Dstl) to create Weevil, a device which is hoped will replace current mine-clearing methods that included Trojan armoured vehicles, which require a three-person team to operate in hazardous areas. The robot mine sweeper is said to be able to clear minefields quicker and safer than present capabilities, reducing risk to soldiers on the front line and it can be operated via remote control by just one person from several miles away. The prototype – which is fitted with a mine plough to clear a safe path – has been successfully tested on a surrogate minefield in Newcastle, and the technology is now being passed to the British Army for further development and more trials. Ian Bell, CEO at Pearson Engineering, said: “We are proud to contribute to such game-changing capability. It brings together decades of development by Pearson Engineering, delivering the very best of minefield breaching technology proven around the world, and contemporary developments in teleoperation. “Work with UK MOD is an incredibly important part of our business, ensuring our troops get the latest in combat engineering capability and that we can effectively defend our nation and allies.” Luke Pollard, minister for the armed forces, said: “It won’t be a moment too soon when we no longer have to send our people directly into harm’s way to clear minefields. “This kit could tackle the deadly threat of mines in the most challenging environments, while being remotely operated by our soldiers several miles away. “It demonstrates British innovation, by British organisations, to protect British troops.” The robot was developed by the Defence Science and Technology Laboratory (DSTL) and Newcastle-based firm Pearson Engineering. The Ministry of Defence said there are no current plans to provide it to Ukraine. DSTL military adviser Major Andrew Maggs said: “Weevil is the perfect combination of tried and tested technology and modern advancements.

Hundreds of cereal factory jobs at risk as as Cereal Partners UK and Ireland proposes Wirral closure

Over 300 jobs are under threat at a Merseyside cereal factory, as Cereal Partners UK and Ireland has announced the plant might close. Cereal Partners, the producer of Nestlé cereals including Cheerios, Shreddies, and Nesquik, is consulting over the future of its Bromborough facility in the Wirral. The company has proposed shifting investment from the plant, which makes both branded and supermarket branded cereals to its Staverton factory in Wiltshire. The workforce at the Wirral site was informed yesterday about the potential shutdown, which would put 314 positions at risk if implemented. A spokesperson for Cereal Partners stated: "Cereal Partners United Kingdom and Ireland (CPUKandI) is talking to employees about proposed changes to manufacturing that would involve a £74m investment at its Staverton factory and the closure of its factory in Bromborough. Regrettably, these proposals would put 314 roles at risk of redundancy. "The Bromborough factory currently manufactures both branded and supermarket branded cereals. Under the proposals, production of branded cereals at Bromborough would be transferred to CPUKandI's Staverton site where £74m would be invested to expand the factory's capability and around 60 new roles created." The company has indicated it may cease producing supermarket branded cereals and exit that segment of the market upon the conclusion of its current contractual obligations, reports the Liverpool Echo. Explaining its reasoning, the firm highlighted: "Both CPUKandI factories are currently below capacity. These proposals would adjust CPUKandI's manufacturing footprint to better match demand and simplify our portfolio to focus investment on our branded cereals. Sales of breakfast cereal are in significant decline owing to the changing habits of UK and Irish consumers and greater competition from alternative breakfast options. "CPUKandI regrets the potential impact on employees and the immediate priority is to work together to review the proposals while supporting people through this process with care and sensitivity." The firm stated it remains open to other options, such as selling the Bromborough manufacturing facility or the supermarket-branded cereal production business itself. The spokesperson said: "It is important that discussions with employees and their representatives are carried out in a private and respectful way and our people are the first to hear of any future developments. There will be no further communication on these proposals until those discussions are complete." Concerns have been raised by a number of Bromborough factory employees, who have reached out to the ECHO. Matt Denton, GMB regional organiser, said: "This is a deeply worrying time for GMB members and their families. For three decades, CPUK has been at the heart of this community, providing good jobs and supporting countless businesses. "Three hundred skilled workers facing an uncertain future is simply unacceptable. GMB will fight to protect jobs, secure fair treatment for workers and explore all potential options to mitigate the impact of this closure. "We demand urgent talks with management and call on the company to engage with us to make sure workers' voices are heard, and livelihoods are prioritised."

Ibstock slashes dividends as profit tumbles amid 'subdued market conditions'

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Rolls-Royce shares skyrocket as iconic company brings back dividends

Rolls-Royce has announced the reinstatement of dividends and launched a £1bn share buyback programme as its full-year profit significantly exceeded expectations. The FTSE 100 engineering behemoth, which has major UK sites in Derby and near Bristol, proposed a 6p per share dividend for investors on Thursday, marking its first payout since the onset of the pandemic, as reported by City AM. A £1bn share buyback scheme will also kick off immediately and run through 2025, according to a market statement. Shares surged over 14% in early trading as investors eagerly jumped aboard. This comes as underlying profit hit £2.5bn, comfortably surpassing a previous forecast of between £2.1bn and £2.3bn. Revenue of £17.8bn also outperformed analysts' consensus of approximately £17.3bn. Following this impressive performance, Rolls-Royce has raised its medium-term targets for profit and free cash flow. Underlying operating profit is now projected to land between £3.6bn and £3.9bn by 2028, while free cash flow is anticipated to range from £4.2bn to £4.5bn. "We are moving with pace and intensity," stated CEO Tufan Erginbilgic, who has spearheaded a remarkable turnaround in his first two years at the helm. He continued: "Based on our 2025 guidance, we now expect to deliver underlying operating profit and free cash flow within the target ranges set at our Capital Markets Day, two years earlier than planned." He concluded: "Significantly improved performance and a stronger balance sheet gives us confidence to reinstate shareholder dividends and announce a £1bn share buyback in 2025." Rolls-Royce's shares have seen a significant uptick since Erginbilgic took the helm in January 2023, driven by a potent mix of soaring travel demand and geopolitical tensions fuelling orders for its jet engines and defence technology. The company's stock price has nearly doubled over the past year and increased almost sixfold over the previous two years. "The group's turnaround has been so impressive that some of its 2027 guidance has been hit two years early, causing the group to upgrade its mid-term guidance," commented Aarin Chiekrie, an equity analyst at Hargreaves Lansdown. "Revenues are being boosted by the upward trend in engine-flying hours, which are now cruising above pre-pandemic levels. But that's just one part of the puzzle."