Bovis float brought forward as P&O profits cruise 33% higher

PENINSULAR & ORIENTAL, the cruises, ferries and ports group, is bringing forward the pounds 350m flotation of its Bovis construction arm to next month after reporting buoyant first-half profits.

The group also disclosed that its cruise and ferries divisions, which made profits of pounds 128m in the six months to 30 June, will be virtually exempt from paying tax when the Government's new "tonnage tax" takes effect next year.

P&O will pay just pounds 20,000 a year tax on the Grand Princess, the biggest cruise ship in the world, and a similar amount on the Oriana, the flagship of its UK-based cruise business.

The Bovis flotation had been scheduled to take place in the first half of next year. Lord Sterling, the P&O chairman, said the decision to accelerate the process had nothing to do with worries about the state of the equity markets next year.

P&O will publish a pathfinder prospectus later this month and list Bovis in October. It is selling 100 per cent of the company with the offer aimed predominantly at UK institutional investors. Bovis made operating profits of pounds 24m last year and pounds 12.3m in the first half of this year - 28 per cent up on the same period in 1998.

The improvement at Bovis helped P&O to achieve a 33 per cent increase in group profits to pounds 183m. The cruise business made pounds 109m and Lord Sterling said there were plans for a major expansion of the business into continental Europe, where P&O believes there is huge potential because of the six- week holidays people get.

The proceeds from the Bovis flotation will be used to help fund P&O's huge investment programme in nine new cruise ships that will cost pounds 2.3bn and double the number of berths in the P&O fleet.

In total P&O expects to raise around pounds 2bn from the disposal of its construction, property and container shipping businesses.

The proceeds were swollen by A$289m yesterday after P&O confirmed the sale of its Australian cleaning and catering interests, and the group is shortly to announce the disposal of its Earls Court and Olympia exhibition halls in London.

Speculation as to the identity of the buyer centres on Daily Mail and General Trust, which has its own large exhibition business.

Lord Sterling also disclosed that there would be further job cuts at its loss-making joint venture cargo shipping business, P&O Nedlloyd, as part of a $100m cost reduction plan. The division employs 8,000 but P&O would not say how many redundancies were planned.

He also confirmed that P&O had talked to the giant US cruise operator, Carnival, but categorically denied that its chairman, Mickey Arnison, had tabled an offer, either for P&O as a whole or its US-based Princess cruise division.

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
ebooks
ebooksA special investigation by Andy McSmith
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Software Development Manager

£40000 - £50000 per annum: Recruitment Genius: This is an exciting opportunity...

Ashdown Group: Product Manager - (Product Marketing, Financial Services)

£30000 - £35000 per annum + Benefits: Ashdown Group: Marketing Manager - Marke...

Recruitment Genius: Compliance Assistant

£13000 per annum: Recruitment Genius: This Pension Specialist was established ...

Ashdown Group: Market Research Executive

£23000 - £26000 per annum + Benefits: Ashdown Group: Market Research Executive...

Day In a Page

Isis hostage crisis: The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power

Isis hostage crisis

The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power, says Robert Fisk
Missing salvage expert who found $50m of sunken treasure before disappearing, tracked down at last

The runaway buccaneers and the ship full of gold

Salvage expert Tommy Thompson found sunken treasure worth millions. Then he vanished... until now
Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Maverick artist Grayson Perry backs our campaign
Assisted Dying Bill: I want to be able to decide about my own death - I want to have control of my life

Assisted Dying Bill: 'I want control of my life'

This week the Assisted Dying Bill is debated in the Lords. Virginia Ironside, who has already made plans for her own self-deliverance, argues that it's time we allowed people a humane, compassionate death
Move over, kale - cabbage is the new rising star

Cabbage is king again

Sophie Morris banishes thoughts of soggy school dinners and turns over a new leaf
11 best winter skin treats

Give your moisturiser a helping hand: 11 best winter skin treats

Get an extra boost of nourishment from one of these hard-working products
Paul Scholes column: The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him

Paul Scholes column

The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him
Frank Warren column: No cigar, but pots of money: here come the Cubans

Frank Warren's Ringside

No cigar, but pots of money: here come the Cubans
Isis hostage crisis: Militant group stands strong as its numerous enemies fail to find a common plan to defeat it

Isis stands strong as its numerous enemies fail to find a common plan to defeat it

The jihadis are being squeezed militarily and economically, but there is no sign of an implosion, says Patrick Cockburn
Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action

Virtual reality: Seeing is believing

Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action
Homeless Veterans appeal: MP says Coalition ‘not doing enough’

Homeless Veterans appeal

MP says Coalition ‘not doing enough’ to help
Larry David, Steve Coogan and other comedians share stories of depression in new documentary

Comedians share stories of depression

The director of the new documentary, Kevin Pollak, tells Jessica Barrett how he got them to talk
Has The Archers lost the plot with it's spicy storylines?

Has The Archers lost the plot?

A growing number of listeners are voicing their discontent over the rural soap's spicy storylines; so loudly that even the BBC's director-general seems worried, says Simon Kelner
English Heritage adds 14 post-war office buildings to its protected lists

14 office buildings added to protected lists

Christopher Beanland explores the underrated appeal of these palaces of pen-pushing
Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Scientists unearthed the cranial fragments from Manot Cave in West Galilee