Back to basics at Dawson
The Investment Column
Thursday 01 June 1995
Yesterday's announcement of pounds 24m of exceptional items to clean up the mess is supposed to draw a line under an unhappy episode in the company's fortunes.
After exceptionals, profits at Dawson were just pounds 1.7m in the year to April compared with the pounds 98m loss last time. Sales were more or less static at pounds 328m.
Dawson's key problems centred on its American adventure, where several acquisitions performed poorly, and tinkering with the Pringle brand, where the name was stretched over too wide a range of goods, such as jewellery and perfumes. The company also opened a number of company-operated Pringle shops, anticipating a sales increase that never materialised.
Problems at Pringle were so bad that the business recorded its first loss last year, hindered further by higher costs, lower margins and warmer autumn weather, which damaged sales.
Sir Ronald Miller, chairman, and Nick Kuenssberg, managing director, departed in March with an estimated pounds 300,000 each in compensation. Their replacements, Derek Finlay and George Fairweather, have begun to win City approval for what amounts to a back-to-basics policy.
Dawson Home Fashions, the American shower curtain business, was sold to Spring Industries for $42m yesterday. Ten US manufacturing plants have been closed and six of them are being sold. Premier Fabrics, the UK weaving business, has also gone. The remaining American businesses, JE Morgan thermalwear and Duofold sportswear, have considerable potential.
The Pringle brand is being refocused on golf attire. The company-operated shops have been sold to concentrate on in-store concessions.
There are still problems, however. Dawson is experiencing higher wool and cashmere prices but is struggling to pass the rises on to the price of a sweater. High street trading is still difficult.
The broker UBS is forecasting profits of pounds 27.5m next year and earnings of 11p. That puts the shares, which closed at 119p yesterday, on a forward rating of 10.8. Not demanding, but high enough until Pringle reasserts itself.
Board creates magnetic field to achieve lift
Singer says the track was 'force-fed down people's throats'
Trend which requires crisps, a fork and a strong stomach is sweeping Mexico's streets
George Lucas criticises the major Hollywood film studios
Film follows park rangers in the Congo
Does Chris Grayling realise what a vague concept he is dealing with?
- 2 Banksy arrest hoax: Internet duped by fake report claiming street artist's identity has been revealed
- 3 Drink alcohol and eat meat to improve male fertility - but cut down on coffee, studies suggest
- 4 Former East 17 frontman Brian Harvey turns up at Downing Street and 'demands to speak to Prime Minister'
- 5 The inventor of the Facebook 'like' button says he never made a 'dislike' button because he feared the 'unfortunate consequences'
Ukraine crisis: Donetsk 'tactical missile' explosion at factory sends blast wave across rebel-held city
Jack the Ripper: Scientist who claims to have identified notorious killer has 'made serious DNA error'
Banksy arrest hoax: Internet duped by fake report claiming street artist's identity has been revealed
Super-sized ships arrive in Britain: How big can they get?
Former East 17 frontman Brian Harvey turns up at Downing Street and 'demands to speak to Prime Minister'
Cameron is warned 'no possibility' of UK reducing immigration and that bid to bring in quota on migrant workers would be illegal
Residents should throw a street party and mix with immigrant neighbours, councils told
Russell Brand threatened with arrest after filming outside Fox News headquarters
Amal Alamuddin calls for the return of the Elgin Marbles from Britain: 'Injustice has persisted for too long'
London bus driver 'kicks gay couple off for kissing'
Lord Freud: Tory welfare minister apologises after saying disabled people are 'not worth’ the minimum wage
iJobs Money & Business
£25 - 30k: Guru Careers: A Corporate Actions Administrator / Operations Admini...
£18 - 23k + Benefits: Guru Careers: We are seeking a Customer Service Executiv...
£60 - 65k + Benefits: Guru Careers: We are seeking a ASP.NET Web Developer / ....
£60,000 - £80,000: Saxton Leigh: Our client is an leading Asset Manager based...