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Lower interest costs help Staveley boost profits 9%

STAVELEY INDUSTRIES, the measurement, mechanical engineering and minerals company, improved pre-tax profits by 9 per cent to pounds 24.4m in the year to the beginning of April. The total dividend was raised 3.7 per cent to 8.5p, writes Alison Eadie.

Operating profits were slightly lower on turnover up 16 per cent, but interest costs were halved to pounds 600,000 due largely to lower rates. Gearing rose to 23 per cent from 12 per cent because of the depreciation of the pound. Stripping out currency, gearing would be nearer 15 per cent, Roy Hitchens, the chief executive, said.

Measurement and minerals improved, making up for the expected decline in mechanical services due to recession in the construction industry.

Order intake in the UK recovered in the second half, with the measurement division taking pounds 18m worth of orders against pounds 12m in the first half. Salter Housewares returned to normal levels, Mr Hitchens said. The trend has continued in the first two months.

The German bagging factory is over its production problems, but the downturn in the economy is causing the delay of some projects.

British Salt improved operating profits on unchanged margins, despite government price controls. It is concentrating on value-added products like salt for water softeners.