Cranes division blow to Hewden: Profits 'remarkable' amid sector downturn

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The Independent Online
PROFITS at Hewden Stuart have fallen by a fifth to pounds 12m. The plant hire company was felled by its tower cranes division, which lost pounds 923,000 as the construction industry failed to recover.

Stripped of the cranes losses, which came after profits of pounds 1.85m last time, the group made pre-tax profits of pounds 13m, down by just pounds 200,000, in the year to 31 January. The final dividend rises from 2.29p to 2.37p, leaving the total up 3 per cent at 3.24p.

Sir Matthew Goodwin, chairman, said the profits were remarkable in a year in which two of Britain's largest contractors went bust. Bad debts now accounted for 1.7 per cent of group turnover, which fell by 3 per cent to pounds 165.3m.

He said Hewden had refused to follow the vicious price-cutting policies of many competitors for the sake of generating cash in the short term.

'You couldn't get out a plumber to mend your washing machine for the price they were charging to hire out machines that cost six figures. It was getting ridiculous.'

Hewden spent pounds 23m on capital expenditure but ended the year with net cash of pounds 13m. 'It would bring me much more satisfaction to come here and say we have an overdraft because demand from operators is such that we have to buy up new plant to cope,' Sir Matthew said.

There had been some second half movement in the hire of tower cranes to the Far East. The fleet has been reduced to 60 where once it numbered 180, and he hoped the division might return to profit this year.

Earnings fell to 4.4p from 5.35p. The shares closed up 0.5p at 104.5p.