Aga cookers help Glynwed to 60% rise at half-time

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The Independent Online
GLYNWED, maker of Aga cookers and a leading supplier of copper tubes for central heating systems, has increased profitability by 60 per cent. Pre-tax profits rose from pounds 18.3m to pounds 29.1m for the six months to 25 June.

Gareth Davies, chairman, added to the optimism with bullish comments on current trading. He said: 'At this stage of the recovery the UK is showing steady growth, particularly in the automotive, engineering and steel sectors.' However, Glynwed failed to raise the interim dividend. It has promised shareholders a maintained payment of 4.15p.

Mr Davies dropped hints that a rise in the final dividend was likely. 'The signals are all positive, but we will leave it until the end of the year and give an appropriate increase at that time,' he said.

Glynwed has six divisions. All but one increased profits. Consumer products, which includes the Aga business, increased operating profit from pounds 3.7m to pounds 4.7m. The foundry operation saw profits rise from pounds 500,000 to pounds 1.7m.

Glynwed's two largest subsidiaries make plastic tubing and engineers' steel. Plastics increased operating profits by 18 per cent to pounds 8.4m and the contribution from steel processing advanced 38 per cent to pounds 11.3m.

However, tubes and fittings, the copper piping part of Glynwed, continued to suffer. Severe price pressures led to deepening losses of pounds 1.9m against pounds 100,000. The company said it was cutting costs.

It also said that there was excess capacity in the supply of copper piping for domestic use. It is exploring the possibility of finding new markets in industrial sectors.

Cash generated through profits has meant a reduction in Glynwed's debt. At the half-way stage the ratio of debt to net assets was 25 per cent, compared with 42 per cent a year previously.

Earnings per share rose to 9.16p against 5.73p. The unchanged dividend is covered 2.2 times.