Heywood dives after price cuts

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The Independent Online
HEYWOOD Williams, the glass distributor exposed to domestic housing and commercial building, yesterday reported sharply reduced half-year profits and said it foresaw no end to recession, writes Robert Cole.

Interim taxable profits were 37 per cent down at pounds 5.1m as Heywood was forced to slash prices. Overall sales rose 20 per cent to pounds 190m for the six months to 30 June, but profit margins in British operations, which account for 85 per cent of business, more than halved.

Ralph Hinchliffe, chairman, said: 'It is difficult to forecast when the recession will end or when we will start to experience an increase in demand for our products.'

The poor performance was heralded by a warning given at the end of June. Heywood has stood by its promise, made in June, to maintain its 4.5p half-year dividend, but Mr Hinchliffe was less sure about the fate of the final payout.

Heywood had to dip into reserves to pay the interim dividend. But Mr Hinchliffe said: 'Unless we see a significant change I do not think we will be able to pay a greatly uncovered final dividend.'

Heywood's business is 60 per cent exposed to renovations, maintenance or improvements, which are heavily dependent on consumer spending.

The rest is split between supplying the motor industry and new building work. All sectors have been hit hard by recession. Earnings per share were 3.4p compared with 7.7p last time.

Heywood shares fell 1p to 177p.