Acquisition helps Inchcape surge: Dividend increased by 17 per cent after improvement in profits to 252m pounds

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The Independent Online
INCHCAPE lifted profits 36 per cent to pounds 252m last year, helped by a maiden contribution from Tozer Kemsley & Millbourn, the car distributor acquired during the year.

The company increased the dividend 17 per cent to 13.75p. Sir David Plastow, chairman, said this was intended to signal 'reasonable confidence in the future'.

Under new accounting rules, FRS3, the rise in profits was smaller - 27 per cent to pounds 250m. The main difference was that the FRS3 figures in 1991 included a pounds 12.9m profit on the sale of Inchcape's tea business, which was treated as extraordinary under the old rules.

Sir David said conditions in the UK 'seem to be getting better. But the overall picture is complex'. Inchcape trades all around the world, and has particularly strong interests in Hong Kong and other parts of the Far East.

Charles Mackay, chief executive, said he believed political difficulties in Hong Kong would be sorted out. 'They have not had much effect on business confidence,' he said.

The company has a wholly owned marketing business in China and carried out two-way trade worth dollars 400m last year.

Inchcape said it was continuing to look for acquisitions all over the world. Mr Mackay said the group's purchasing policy had four strands - acquisitions had to be strategically important and add to the core businesses; there had to be good management available to run them; the price had to be right; and the company was prepared to be patient.

Motors accounted for 60 per cent of group profits, marketing for 20 per cent and services for 16 per cent. The only area to show a downturn was shipping services.

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