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He will take on the finance director responsibilities on 1 December 2007. David Roache will be standing down as finance director of Acertec from 31 December 2007, rather than at the next AGM as he had planned.

The group said that Holdsworth has had wide experience at board level in the engineering and construction sectors, most recently as finance director of Morrison plc where he assisted in its successful turnaround. Previously he held senior positions with Alfred McAlpine plc and with Smiths Group plc.

Engineered steel 

Acertec (LSE:ACER) is one of the UK's leading manufacturers of engineered steel products for use in the automotive and construction markets. It was formed through the buy-out of Hall Engineering Holdings plc in 1999 by the management team backed by Candover Partners Limited.

The company has two divisions: construction products ("BRC") and car body ("Stadco").

BRC is the UK's largest supplier of engineered steel products (re-bar and mesh) used in concrete construction. Stadco is the UK's largest supplier of body-in-white ("BIW") pressings and sub-assemblies to automotive original equipment manufacturers ("OEMs").

Acertec was admitted to AIM on 16 May 2006. The company achieved strong organic growth in 2006, increasing turnover from continuing operations by 16 per cent to £324.7 million, compared to £280.8 million in 2005. Total operating profit from continuing operations, before amortisation and exceptional items, went up by 30 per cent to £16.2 million in 2006, compared to £12.5 million in 2005.

Its automotive supplier arm Stadco faced a difficult year, however, and the firm’s borrowing increased due to working capital needs and one-off tax catch-ups in Germany.

Acertec saw its share price steadily decline in value, from 192.5 pence in January to just 54 pence on 28 November 2007.

Accounting and control issues 

In July, the group said that it expected results for the rest of the year to be in line with expectations. The group announced on 5 September 2007, however, that it had discovered a discrepancy in the accounting for stock at one of the divisions of BRC in the UK.

An investigation into the discrepancy undertaken by independent lawyers Peters and Peters and accountants KPMG showed that there had been a breakdown in control within the BRC division. Accounts had been manipulated and misstated over a period of more than two years.

The underlying accounting and control issues started to come to light following the appointment of a new divisional finance director to the BRC division concerned, in March 2007. The group replaced all the key divisional accounting staff, except one.

The £600,000 investigation of the relevant division's balance sheets at 30 September 2007, 31 December 2006 and 31 December 2005 found a total discrepancy of £5.0m arising from an overstatement of stock accounts and an understatement of accruals.

No evidence of theft was found. The preliminary conclusion was that the trading profits of the division and therefore of the group had been overstated during the periods concerned.

The full results for the year ended 31 December 2006 and the balance sheets at 31 December 2006 and December 2005 will be restated when the accounts for the year ending 31 December 2007 are published.

Related links

• Acertec PLC