Dividend is slashed as Martin goes into red

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INVESTORS in Martin International, which sells 40 per cent of its clothing products to Marks & Spencer, were left considerably poorer yesterday as the shares collapsed 38p to 49p on an unexpected dive into the red.

Shareholders will also suffer a significant cut in dividend income, with the payment for the first six months of 1993 reduced from 1.7p to 0.4p.

Even though the company flagged in June that trading was depressed, the City had not envisaged a further sharp deterioration over these four months.

Martin's problems do not relate to M&S but to the loss of pounds 3m of business with a long-established American customer and a 65 per cent downturn in trade in the Middle East.

Michael Kidd, chairman, who warned shareholders in June to expect a downturn in profits, announced a first-half loss of pounds 270,000.

The result, set against a pounds 142,000 profit for the same period last year, was struck on turnover ahead by 10 per cent to pounds 32.7m.

Traditionally tight profit margins had been squeezed further by the 'very competitive' operating environment worldwide, Mr Kidd said.

'The situation for the second half in the UK is more encouraging, but we do see continuing problems overseas,' he added.

Mr Kidd said that, apart from M&S activities, the rest of Martin's operations had problems.

He added: 'It is now apparent that the profit from continuing operations will be lower than in 1992 and, after the results of discontinued businesses and closure costs, we anticipate a small loss for the year before taxation.'