Le Creuset looking for growth

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LE CREUSET, the manufacturer of fashionable French ovenware. predicted continuing growth as it revealed a modest increase in profits for the first half of the year, writes John Murray.

It made pounds 1.15m pre-tax ( pounds 1.1m) on turnover up pounds 2.35m to pounds 17.8m. Higher interest charges and pounds 316,000 in redundancy costs disguised healthier operating profits, up 24 per cent to pounds 1.8m.

Paul van Zuydam, chairman, acknowledged that the turmoil in the currency markets, combined with high interest rates, had made trading tough for Le Creuset.

But he was optimistic that French interest rates would fall and that stability would return to the foreign exchange markets. Le Creuset has a high proportion of sterling and dollar earnings and most of its borrowing is in France.

'We still believe we will have an increase in volumes despite the very difficult market conditions,' he said. 'Any upturn could feed through very quickly.'

He said the company was benefiting from the rationalisation of its two French plants and the acquisition of the Screwpull corkscrew business. The switch from selling through agents in the US to a dedicated sales force was producing higher volumes.

Earnings per share rose 4.5 per cent to 4.6p, but there is no interim dividend, as before. Le Creuset shares rose 1p to 281p.