Fisher rocked by pounds 151m write-off

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The Independent Online
Albert Fisher saw its shares rise 8 per cent to 42.5p yesterday despite a pounds 151m exceptional charge that sent the fruit and vegetables, seafood and dressings group heavily into the red in the year to August.

The market focused instead on a maintained dividend and a broad hint from the chairman, Stephen Walls, that the payout was safe.

Fisher's shares have underperformed the market by more than 60 per cent over the four years since Mr Walls took over as executive chairman, falling to less than 40p before yesterday's figures, at which level the shares offered a dividend yield of more than 12.5 per cent. Holding the dividend helped the shares add 3p yesterday to close at 42.5p.

Figures for the 12 months to August were hit hard by the one-off charge which covered Fisher's exit from operations in Germany, Spain and North America. Most of the charge represented a write-down in goodwill which the company described as a book-keeping exercise with only a small impact on cashflow.

Before the exceptional charge, profits rose slightly from pounds 39.5m to pounds 40.1m, with a good performance from Fisher's European food processing operations offset by flat profits from fresh produce sales in Europe and seafood, which was hit by a range of mainly weather-related problems.

Mr Walls, who has in the past attempted to turn down a bonus payment from the company which he felt was unjustified by results, also introduced a new performance-related incentive scheme for 30 top managers yesterday.

He stressed that the scheme would only pay bonuses, which could reach 100 per cent of base salary, if Fisher performed better than the average of its peer group over the next three years.

He confirmed that, had the scheme been introduced when he took over as chairman in 1992, it would have paid nothing out so far because of the company's poor performance in recent years.

According to Mr Walls, Albert Fisher has been transformed since 1991 from a company that derived most of its sales from commodity food products, which enjoy extremely low margins, to one more focused on higher-return, added-value food processing.

The recently announced sale of the company's North American distribution operations was in line with that policy. The discontinued operations chipped in pre-tax profits of just pounds 5m in the year from sales of pounds 382m and its performance had barely changed over the past three years.