21.08.2017

Progress continues at Snorkel

According to a trading statement issued by Tanfield – the prior owner of Snorkel, which retains a 49 percent stake- the aerial lift manufacturer has continued to post solid revenue growth and turned last year’s operating loss into positive numbers this year.

Snorkel’s first half revenues were $79.7 million, up 13 percent on the same period last year, while last year’s operating loss- before depreciation of $1.4 million has been turned into a profit this year of $1.5 million.

The upward trend continued into the second quarter with sales improving 20 percent to $44.9 million, with an operating profit of $1.1 million. The change around is due to lower material costs. The business is on target for a full year operating profit in 2017.

Vertikal Comment

This is positive news for Snorkel which is still fighting back to normality, following years of substantial decline and mismanagement under Tanfield.

Tanfield is now beginning to alert shareholders to the fact that it may notreceived any payment at all for the 51 percent holding in the business it gave to Ahern back in 2013. The deal stated that Tanfield can request payment for the holding, should Snorkel make an operating profit before depreciation (EBITDA) of $25 million or more in any 12 month period by 30 September 2018. The chances of that happening within the time frame are now looking increasingly unlikely.

After September next year Tanfield will simply lose any right to claim payment for the 51 percent holding, but will retain its minority stake in the business. As the only asset remaining within Tanfield it is quite likely that when the time comes it will seek to sell the stake to Don Ahern for whatever price he is prepared to pay.

Time will tell.