Tanfield: Electric vehicle firm 'faces car crash'

Dan Milmo and Eloise Veljovic
The Guardian,
Wednesday July 2, 2008

Executives at one of Britain's greenest manufacturing companies, Tanfield, were in talks with investors last night after a drastic profit warning hit shares in the company.
Tanfield makes electric vehicles including milk floats but problems with sales of its biggest product, cherry-picker lifts, triggered an 80% slump in its already depressed share price yesterday. The Tyne and Wear-based firm said revenue growth would be significantly lower than forecast because the global credit crisis has hit demand at its powered platforms business. Tanfield's shares closed at 5.9p, compared with a 12-month high of 203.5p.
The company said its main distributors and customers for powered platforms, used on oil rigs and construction sites, had been affected by spending freezes and a drought in the credit markets. Tanfield said it had taken action "immediately" to postpone US expansion plans.
Its board said in a statement that year-on-year revenue growth would be "at a significantly lower level than previously forecast". Tanfield's chief executive, Darren Kell, and finance director, Charles Brooks, were in talks with shareholders and unavailable for comment last night. A spokesman denied Tanfield was seeking further funds, but analysts were gloomy about its prospects. One broker said the move in the share price increased the difficulty of emergency fund raising. "This has the makings of a total car crash," Evolution Securities said in a note.
Tanfield's profits are now expected to fall to £14m, against forecasts of a £43.4m profit, according to the company's house broker, St Helens Capital.