Thanks to last summer's restructuring, junior engineering firm Energy Technique has been 'consistently in profit' and in May managing director Leigh Stimpson expects to announce a hefty profit rise for the year to March, reports James Crux.

Fully-listed Energy Technique, which lost money every year for seven years before making an almost invisible £2,000 in 2000-1, insists it is a radically-altered outfit focused on the heating and ventilation industry.

The business was restructured last June when a consortium led by Ofex-listed London & Boston Investments invested £1.1 million in return for shares. This allowed Stimpson to sell loss-making businesses and concentrate on the company's 'highly profitable' Diffusion arm.

He is confident the group will be in substantial profit when it reports in a few month's time. Last December's interims to September were extremely encouraging, with the Diffusion business showing operating profits up 88 per cent to £229,000 on sales 16 per cent ahead at £6.43 million.

Diffusion's core business is manufacturing fan coils and convector heaters, concentrating on products that control building environments 'with an emphasis on air quality and energy saving'.

Stimpson said that over the past six months Diffusion has seen record sales ahead of budget, as is profit, while gearing fell from 300 per cent to 63 per cent.

Agreements have been signed for the distribution of Panasonic UK's air-conditioning products and a deal is about to be finalised with Nutech Canada for the exclusive distribution of its high-efficiency room filters. Another significant development, given recent fears over anthrax, is the imminent formation of a joint venture (Diffusion Medical) to manufacture and distribute a patented pathogen-killing air-filter that could be sold to hospitals with 'isolation suites'.

Energy Technique's customers include a raft of blue-chip names, including The Savoy Hotel, Claridges, Marks & Spencer and Land Securities. Since 1978, the Diffusion business has supplied fan coil units to the Houses of Parliament.

The London & Boston-led restructuring consortium includes property management group Roche (ROG) and Harrell Hospitality – headed by Energy chairman Geoffrey Dart. London & Boston Investments, whose chairman Stephen Komlosy is a non-executive director of Energy Technique, has a 21.4 per cent stake in the company.

Energy Technique shares change hands for 3.5p, valuing the business at just £2.56 million. Analysts believe this could be a speculative punt.