Allied Leisure to hold payout

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The Independent Online
ALLIED LEISURE, the nightclub and tenpin bowling operator whose share price has plummeted by 60 per cent to 31p in the past fortnight, said yesterday it knew 'no reason' for the fall.

The directors said the company would propose a maintained final dividend of 3.25p when it released its results in early October. This helped the shares gain 5p to end the day at 36p.

The statement said Allied, where pre-tax profits in 1990-91 grew 19 per cent to pounds 3.1m, continued to trade profitably despite the recession and the hot weather in May and June.

At the time of a pounds 16.13m rights issue in May last year - the second in 12 months - Allied said it intended to restrict net borrowings to below 55 per cent of shareholders' funds. Yesterday it confirmed that it was maintaining that restriction and calculated that year-end total net borrowings would be about pounds 15m against about pounds 12m last year.

'Our stock is not traded in large numbers, so the sale of any reasonable number of shares will move the price one way or another,' said an Allied spokeswoman.

'Nobody wants to buy leisure stock at the moment. We have been hit by the gloomy economic view for leisure as a whole in the near future.

'If someone wants to sell stock market-markers will mark it down until they find a price at which people want to buy,' she added.

Alexander Proudfoot, the management consultancy and staff training group whose shares have fallen 111p to 245p since the beginning of June, said yesterday it expected to maintain the dividend this year on current trading expectations.

Total dividend for 1991 was 19.5p. Proudfoot said trading conditions had marginally improved.