Overall operating profit margins rose a smidgeon, from 10.1 to 10.2 per cent. However, if you ignore the effect of acquisitions, the return on sales stuck at 10.6 per cent. Peak margins in 1989 were 12.3 per cent.
Bruce Farmer, Morgan's chief executive, thinks he can beat that with a combination of cost control, acquisitions and new products, helped by minimal price increases.
The stock market remains unconvinced. Yesterday's 5p rise in the shares to 332p was more in response to an unexpected rise in the dividend than to a reassessment of prospects for earnings growth.
On forecasts of pounds 71m, the prospective multiple of 16 times is below the sector. That will look cheap if Mr Farmer achieves his margin target.
The market will want more hard evidence of profit progression before chasing the share price much higher.