Dewhurst suffers in building doldrums

(First Edition)

STILL moribund construction activity has depressed profit margins at Dewhurst, the electronic control equipment maker, writes Robert Cole.

Dewhurst's most important customers make lifts, but are suffering because little new building work is being undertaken.

Richard Dewhurst, chairman, said: 'Construction is in the doldrums and the volume of new lifts required is low. Weak demand has also meant we have had to absorb price pressure.'

But he added: 'We have been helped by a reasonable amount of refurbishment work. Profit growth in the coming year is expected to be generated by careful cost control and improvement in efficiency.'

Dewhurst also makes automatic door-opening mechanisms on new commuter trains, key pads for cash machines and similar equipment. More business in its secondary areas of activity pushed turnover up to pounds 10.7m from pounds 9.1m and left pre-tax profits 10per cent higher at pounds 935,000.

However, poor activity among developers depressed the profit margin from 9.3per cent to 8.8per cent.

Dewhurst has a two-tier share structure, with family interests controlling half the voting shares. Mr Dewhurst said the board discussed enfranchising all shareholders but decided against the move.

Despite a 9per cent increase in the total dividend to 2.06p, the voting shares were unchanged in price at 73p. The non-voting 'A' shares rose 1p to 73p.