Better margins help McAlpine back to black

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The Independent Online
DOUBLED operating margins from housebuilding and strong minerals sales helped Alfred McAlpine back into the black in the eight months to June despite continuing losses from contracting in Britain and from the US.

McAlpine announced a change in its year-end to December when it staged a pounds 25m rights issue in June to reduce debt and provide capital for the housebuilding operation.

Oliver Whitehead, chief executive, warned that the construction arm would continue to suffer from difficult trading conditions for the rest of the year. He hoped the division, which lost pounds 900,000 in the period, would make a profit in 1995.

The loss restricted group profits to pounds 3.1m compared with a pounds 2.5m loss for the six months to April 1993. Earnings per share were 3.1p (2.1p loss). The dividend was maintained at 3p.

Completions in the house- building operation increased from 773 to 822. Selling more detached houses pushed the average selling price up from pounds 72,600 to pounds 90,000.

Mr Whitehead said the market had picked up in August. He still expected to achieve 1,800 sales for the year.

The land bank increased from 11,650 plots to 12,250 at an average cost of pounds 21,500.

In the US there was an eight-month loss of pounds 300,000 after the contracting arm wiped out improved profits from minerals. Second-half profits are not expected to recover the first-half deficit.

Minerals bounced back from last year's pounds 200,000 loss. Volumes increased in all areas and price increases pushed through in the spring have been maintained. The shares closed 3p higher at 201p.