Hammering for Dobson Park

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TOUGH trading conditions in power tools and industrial electronics led to a one-fifth drop in full-year profits at Dobson Park Industries.

The taxable surplus fell from pounds 13.1m to pounds 10.3m for the 12 months to 3 October, on turnover down from pounds 234m to pounds 209m. Earnings per share slumped from 7.1p to 5.5p. But a maintained final dividend of 3.85p leaves the total unchanged at 5.75p.

The company's power tools division, whose products include Kango hammers, slipped from a profit of almost pounds 1m to a pounds 563,000 loss due to a sharp drop in demand in Germany, Italy and Spain.

Profits at the group's industrial electronics businesses fell from pounds 5.5m to pounds 4.6m. Alan Kaye, chairman, said the performance was disappointing and blamed depressed aerospace and defence markets for the problems.

However, a timely cost-cutting programme at the group's mining equipment division checked the decline in operating profits, down from pounds 6.6m to pounds 6.4m on a much bigger fall in sales from pounds 122m to pounds 101m.

The division, which makes deep coal mining machinery, underwent a sweeping rationalisation more than a year ago, leading to the closure of three factories in Yorkshire.

Despite the cost-cutting, however, its prospects depend on the future of Britain's coal industry. About half the division's sales are to British Coal, and with many pits under threat, Dobson may have to take further remedial action after the Government's energy review next spring.