Investment Column: Standards slip at Siebe
Wednesday 03 June 1998
The engineering giant's share price fell 126p to 1377p yesterday after pre-tax profits came in at pounds 486m, a rise of 14.7 per cent, but below the pounds 500m some analysts had expected.
The company was hurt by the downturn in the Far East and the strength of the pound and dollar. But the City was also worried by a slowdown in organic growth during the second half of the year.
Moreover, analysts were shaken by the high cost of restructuring and the fact that Siebe says pounds 100m more must be spent on heavy cuts over the next two years, when it plans to cut 4,000 jobs world-wide.
This is the downside of Siebe's recent flurry of acquisitions. In the past year, it has spent pounds 1.3bn on deals that include APV, the industrial processing group, and Eurotherm, the controls maker. Bedding down those buys will cost money.
Chief executive Allen Yurko believes the pound and dollar will remain strong for some time. To counter this and other problems - like a squeeze on prices as a result of deflation - some manufacturing will be shifted to lower-cost areas.
Six months ago Mr Yurko was bullish about the Far East but he admitted yesterday he plans to shift away from the region.
Analysts have downgraded their 1998 profit estimates to about pounds 545m. This gives Siebe a forward multiple of 20 times. High enough
Long after his career in English football has ended, Emile Heskey's impotency in front of goal remains an object of ridicule.
- 1 Stamford Hill council removes 'unacceptable' posters telling women which side of the road to walk down
- 2 Kim Kardashian 'nude pictures' leaked on 4chan weeks after Jennifer Lawrence 'The Fappening' scandal
- 3 Scottish referendum 'English question': Tory MPs call on David Cameron to create an English first minister in wake of No vote
- 4 Iranian blogger found guilty of insulting Prophet Mohammad on Facebook sentenced to death
- 5 Free U2 album: How the most generous giveaway in music history turned into a PR disaster
Stamford Hill council removes 'unacceptable' posters telling women which side of the road to walk down
Kim Kardashian 'nude pictures' leaked on 4chan weeks after Jennifer Lawrence 'The Fappening' scandal
Iranian blogger found guilty of insulting Prophet Mohammad on Facebook sentenced to death
Hitler’s former food taster reveals the horrors of the Wolf’s Lair
Jennifer Lawrence 'naked sex video' will be leaked next, threatens 4Chan celebrity photo hacker
Scottish independence referendum: A nation divided against itself
Scottish referendum results: Cross-party consensus collapses amid Tory-Labour spat on the 'English question'
Scottish independence: David Cameron is becoming the 'George Bush of Britain'
Russia freezes Ukraine into submission: Kiev admits country doesn't have enough fuel for winter
Archbishop of Canterbury admits doubts about existence of God
Plebgate MP Andrew Mitchell called officer a 'little s**t', claim court documents 'exposing ex-Chief Whip's 'record of abusing police'
iJobs Money & Business
£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...
Up to £100k or £450p/d: Saxton Leigh: My client is a leading commodities tradi...
£320 - £330 per day: Ashdown Group: The Ashdown Group have been engaged by a l...
To £75,000 + Pension + Benefits + Bonus: Saxton Leigh: My client is looking f...