Dog's life for a pet supplier in a slump

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The Independent Online
THE RECESSION and Black Wednesday get everywhere. Yesterday one of the stock market tiddlers - Armitage Brothers, the pet supplier - was telling its tale.

Poor Christmas sales of treats and toys for Fido the dog or Sammy the cat slumped. But there was some respite, courtesy of the export opportunites provided by September's devaluation of sterling.

'People were spending pounds 3 on a present for the dog this Christmas, where last year they would have spent pounds 4,' bemoaned Armitage's chief executive, Russell Taylor.

But exports, a relatively new market for Armitage, looked more promising.

Armitage's letterheads bear a Royal seal thanks to the Royal corgis' penchant for its chocolate drops. Royal approval helps overseas but Mr Taylor fears a backlash in Britain. 'After all the bad publicity the Royals have attracted I don't know if it's a good thing any more,' he said.

Profits were also supported by stronger sales of dried dog food. He identifies 110 markets for pre- prepared dog food, but in only two does tinned food lead in market share.

'Dried food contains all the vitamins and nutrients dogs need, but at half the price,' Mr Taylor said.

Unfortunately, the pounds 6m market capitalisation of Armitage is no match for the marketing clout of Pedigree Chum and Spillers - its main rivals.

The balance meant overall operating profits were pounds 784,000 in the six months to 13 December, down from pounds 834,000 last time. Turnover was down to pounds 12.9m from pounds 13.1m. Pre-tax profits were level at pounds 715,000, helped by lower interest charges.

Earnings per share figures are dented by the absence of tax refunds granted in previous years. Against 13.4p last year, the figure is 11.9p this time.

However, shares rose 3p to 153p, comforted that Armitage managed to hold the interim dividend at 2.6p.