The MG Rover crisis has forced automotive supplier Wagon to lose 100 jobs and take an additional £2 million of restructuring charges.

The Warwick-based company added that the loss of sales from its supply contract would hit profitability into its next financial year.

MG Rover accounted for around £14 million of annual sales, out of a total of £450.6 million, but the high-margin business generated profits of about £1.5 million.

Wagon supplied small assembly parts and steel stampings to Longbridge, but said it had closed one of its stamping factories in Oxford, with the loss of 65 jobs.

Another 40 posts have gone at factories across the rest of the group, which employs 500 people across the Midlands at sites in Tyseley, Warwick and Brownhills.

Chief executive Pierre Vareille said the demise of MG Rover had been anticipated for a long time and plans had been made.

He said: "It was not a surprise. We knew a long time ago that if they were not able to make a deal with the ( Chinese carmaker) SAIC, they would be in a dire situation.

"We had a plan; every supplier did. But MG Rover only represented about three per cent of our total turnover, so the impact for the company as a whole is not massive."

Wagon was among the firms which halted the delivery of parts to Longbridge in April, when it emerged it was still owed £900,000 for outstanding payments.

Mr Vareille said: "We had heard the week before that Rover had not paid for the parts and they could not say when they would pay.

"We made about 50 telephone calls to them, to try to resolve the situation, but they could not pay us."

Mr Vareille said no more redundancies were planned as a result of the end of car production at Longbridge.

He said: "It is all about moving onwards. The end of MG Rover came two months ago, and in this business that is like a century ago."

As a result of the decision to close the Oxford factory, the group booked another £2 million of exceptional charges in the year to March 2005, which together with a further £11.8 million of reorganisation costs incurred elsewhere in the company, saw it end the year with a pretax loss of £1.5 million.

On an underlying basis, however, pretax profits - before exceptional items and goodwill - were up by 17.6 per cent to £19.4 million.

Sales for the period were down 7.5 per cent to £450.6 million, but operating margins widened from 4.1 per cent to 5.1 per cent following improvements to the group's operational performance and the elimination of losses in engineering services.

Mr Vareille said the group had also been successful in passing through the costs of increased raw material prices - especially steel - to its customers.

"The bulk of the restructuring has been completed and we don't anticipate any further large exceptional items going forward," said Mr Vareille. "Around £4 million of the cost savings will come through in the second half of 2005-06, with the full annualised savings of £6 million thereafter."

The firm had been hit by the loss of work on the new Renault Espace, but Mr Vareille is confident this would be made up with new contracts.

He pointed to the group's £83 million forward order book, a record for the firm.

He said: "Most importantlywe have achieved a record level of order intake during the year, which reflects the increased focus on the customer."