Chloride back in the black

The Investment Column

Chloride was one of the worst performing shares of the 1980s and results in the current decade have been even less inspiring. Since 1991, when Keith Hodgkinson moved over from GEC as chief executive, the accounts have been littered with exceptional charges as the management has gradually dumped the once-famous batteries business and moved into electronic and electrical products.

It has now returned to the black for only the second time in the five years Mr Hodgkinson has been at the helm. Pre-tax profits of pounds 6.97m in the 12 months to March replaced a loss of pounds 318,000 last time. The figures overstate the improvement, given that a previous pounds 2.79m loss on disposals turned into a gain of pounds 1.38m in the latest period. Even so, operating profits from continuing businesses soared 48 per cent to pounds 6.45m.

The group remains heavily dependent on its uninterruptible power supplies operation, which represents over four-fifths of group operating profits. But with computer networking growing in popularity and the use of ever- more sophisticated electronic apparatus in everything from shops to turnstile systems, prospects are good. With overall order levels up 30 per cent as well, last year's 22 per cent rise in profits to pounds 4.36m should be repeatable.

Much of the rest of the group's growth from core businesses came from reduction or elimination of losses. Emergency lighting in the UK cut its deficit by around pounds 500,000 and is now "just" back in profit, while the specialist battery chargers to power switching distribution division staged a pounds 681,000 turnround to profits of pounds 364,000.

The company is now proposing to release pounds 14m from its pension fund by effectively transferring most of the liabilities to Legal & General, and the company could have as much as pounds 20m to spend by the end of this year.

Even so, questions remain. Advanced Design Electronics, the burglar alarm business for which Chloride paid pounds 6.5m, has plunged to a pounds 797,000 loss in its first full year with the group. Meanwhile it has yet to build a commanding position in any of its business areas.

Profits of pounds 7m this year would put the shares, up 0.25p at 29.25p, on a prospective p/e of 15. High enough for now.

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksA special investigation by Andy McSmith
  • Get to the point
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

Ashdown Group: Treasury Assistant - Accounts Assistant - London, Old Street

£24000 - £26000 per annum + benefits : Ashdown Group: A highly successful, glo...

Ashdown Group: Business Analyst - Financial Services - City, London

£50000 - £55000 per annum: Ashdown Group: Business Analyst - Financial Service...

SThree: Trainee Recruitment Consultant

£18000 - £23000 per annum + OTE £45K: SThree: At SThree, we like to be differe...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + competitive: SThree: Did you know? SThree is the o...

Day In a Page

General Election 2015: Chuka Umunna on the benefits of immigration, humility – and his leader Ed Miliband

Chuka Umunna: A virus of racism runs through Ukip

The shadow business secretary on the benefits of immigration, humility – and his leader Ed Miliband
Yemen crisis: This exotic war will soon become Europe's problem

Yemen's exotic war will soon affect Europe

Terrorism and boatloads of desperate migrants will be the outcome of the Saudi air campaign, says Patrick Cockburn
Marginal Streets project aims to document voters in the run-up to the General Election

Marginal Streets project documents voters

Independent photographers Joseph Fox and Orlando Gili are uploading two portraits of constituents to their website for each day of the campaign
Game of Thrones: Visit the real-life kingdom of Westeros to see where violent history ends and telly tourism begins

The real-life kingdom of Westeros

Is there something a little uncomfortable about Game of Thrones shooting in Northern Ireland?
How to survive a social-media mauling, by the tough women of Twitter

How to survive a Twitter mauling

Mary Beard, Caroline Criado-Perez, Louise Mensch, Bunny La Roche and Courtney Barrasford reveal how to trounce the trolls
Gallipoli centenary: At dawn, the young remember the young who perished in one of the First World War's bloodiest battles

At dawn, the young remember the young

A century ago, soldiers of the Empire – many no more than boys – spilt on to Gallipoli’s beaches. On this 100th Anzac Day, there are personal, poetic tributes to their sacrifice
Dissent is slowly building against the billions spent on presidential campaigns – even among politicians themselves

Follow the money as never before

Dissent is slowly building against the billions spent on presidential campaigns – even among politicians themselves, reports Rupert Cornwell
Samuel West interview: The actor and director on austerity, unionisation, and not mentioning his famous parents

Samuel West interview

The actor and director on austerity, unionisation, and not mentioning his famous parents
General Election 2015: Imagine if the leading political parties were fashion labels

Imagine if the leading political parties were fashion labels

Fashion editor, Alexander Fury, on what the leaders' appearances tell us about them
Phumzile Mlambo-Ngcuka: Home can be the unsafest place for women

Phumzile Mlambo-Ngcuka: Home can be the unsafest place for women

The architect of the HeForShe movement and head of UN Women on the world's failure to combat domestic violence
Public relations as 'art'? Surely not

Confessions of a former PR man

The 'art' of public relations is being celebrated by the V&A museum, triggering some happy memories for DJ Taylor
Bill Granger recipes: Our chef succumbs to his sugar cravings with super-luxurious sweet treats

Bill Granger's luxurious sweet treats

Our chef loves to stop for 30 minutes to catch up on the day's gossip, while nibbling on something sweet
London Marathon 2015: Paula Radcliffe and the mother of all goodbyes

The mother of all goodbyes

Paula Radcliffe's farewell to the London Marathon will be a family affair
Everton vs Manchester United: Steven Naismith demands 'better' if Toffees are to upset the odds against United

Steven Naismith: 'We know we must do better'

The Everton forward explains the reasons behind club's decline this season
Arsenal vs Chelsea: Praise to Arsene Wenger for having the courage of his convictions

Michael Calvin's Last Word

Praise to Wenger for having the courage of his convictions