THE Allen’s group have ended a turbulent year £4.5m in the red after making a profit of £20.6m a year ago.

The company, which sold its construction business last year and moved from Bolton to Newton-le-Willows, is now focused on its fast-growing Speedy Hire business, which is number two in the tool hire market.

The group is planning to change its name to Speedy Hire in line with its new focus.

Chief executive John Brown said he is confident in the new company’s prospects: ‘‘We are determined to get to number one in the market place, we have ample resources to grow both by acquisition and by new openings.’’

Mr Brown, 57, who opened Speedy’s first depot in 1977, after joining Allen as finance director in 1973, said he is ‘‘relishing the challenge’’ of harnessing Speedy’s potential.

‘‘We are all looking forward, the last year has obviously been difficult.’’

Sales growth

In the past year, sales at Speedy’s 200 depots nationwide, climbed from £83m to £101m, including like-for-like sales growth of 15 per cent.

Operating profit was up from £15.4m to £17.2m. Speedy’s main rival is a firm called HSS, which has a turnover of £122m a year.

Mr Brown said: ‘‘Our growth over the last two years has been 40 per cent, their’s has been six per cent. We are determined to catch them.’’

Group turnover in the year to April 1 came in at £321.5m against £347.9m in the 53 weeks to April 1 2000.

Despite sliding into the red, Allen is holding the dividend at 13.9p per share.

Mr Brown and new chairman David Wallis replaced Allen stalwarts Don Greenhalgh and Ken Fox, who resigned in April to make an ultimately unsuccessful bid for the ailing building contracts business, which was eventually sold to Montpellier for £1m.

‘Unacceptable performance’

Mr Wallis said the performance over the past year had been ‘‘totally unacceptable’’ in all areas but Speedy.

Looking at what went wrong he said: ‘‘A justifiable criticism of Allen was it had become too diversified. It was regarded as a conglomerate and with the exception of Speedy Hire, no single division had a leading position in its chosen market. This resulted in a lack of focus.’’

Mr Wallis said the situation had been compounded by costly errors in individual divisions.

The biggest problem was in building contracting, as it emerged that several large contracts undertaken by Yorkshire-based business P S Turner, ‘‘were flawed and incorrectly priced.’’

Losses of £13m were estimated to have stemmed from this.

Problems with contracts were also found at Ryan Utility Services, a pipeline repair and replacement business. Ryan is expected to be sold in the coming months.

The recent collapse of Independent Insurance also took its toll on Allen, with the group providing £800,000 following Independent’s failure to write off the cost of premiums relating to 2001/02.

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