Margins improve at Low & Bonar
Tuesday 13 July 1993
The money went on overhauling US operations, shutting down the lossmaking non-woven business in Dundee and selling off remaining African interests.
In the first six months of this year overall group margins rose from 8.6 to 9.9 per cent. Despite flat volumes, interim pre-tax profits to 31 May rose by 21 per cent to pounds 14.3m, although pounds 1m stemmed from currency translation.
'Margins across the group are tantalisingly close to 10 per cent,' said Mr Leng. 'The growth is coming from unit-cost efficiency. We have abandoned certain sales where we cannot achieve added value or where we were working too hard to achieve the required return.'
The UK now contributes nearly two-thirds to European profits, which grew by 20 per cent to pounds 13.2m. Packaging profits up by pounds 600,000 at pounds 5m were helped by an eight-week contribution worth pounds 850,000 from Cereal Packaging, acquired in April after a pounds 50.2m rights issue.
That deal, plus the purchase of Carton Systems for pounds 17.35m on 16 June, means Low & Bonar is now the UK's second largest carton manufacturer.
European plastics suffered from severely reduced demand. Profits fell to pounds 1.7m from pounds 2.2m despite a near-doubling of profits from UK operations. In the US, profits and margins in both packaging and plastics improved, with total operating profits up to pounds 3.7m from pounds 2.2m.
First-half borrowings of pounds 18m, down from pounds 37m, were flattered by the balance of the rights issue proceeds. Since then the company has spent the balance on Carton Systems but post-acquisition gearing of 25 per cent is below the 30 per cent figure seen at the year-end.
Earnings of 10.22p were up by 14 per cent and the dividend is increased by 7.4 per cent to 2.9p. Yesterday the shares rose from 338p to 346p.
- 1 Home Office says Nigerian asylum-seeker can’t be a lesbian as she’s got children
- 2 What happens to your body when you give up sugar?
- 3 Drugs Live cannabis trial: Hash is less harmful than any other drug, expert claims
- 4 Turkish Airlines flight TK 726 crash-lands on Nepal runway amid dense fog
- 5 Apple and Google users being spied on for a decade because of 'Freak' security flaw
The City of the Monkey God: Archaeologists claim to have found city lost for 1,000 years in remote Honduran jungle
Turkish Airlines flight TK 726 crash-lands on Nepal runway amid dense fog
Japanese island overrun with cats after population explodes
London property boom built on dirty money
Becky Watts: Stepbrother and his girlfriend named locally as two arrested on suspicion of murder
Durham Free School: 'Creationism taught at' free school facing closure
Nearly 100,000 of Britain's poorest children go hungry after parents' benefits are cut
Ukip would cut billions from Scottish budget to fund English tax cuts
End of the licence fee: BBC to back radical overhaul of how it is funded
Ukraine crisis: Top Chinese diplomat backs Putin and says West should 'abandon zero-sum mentality'
Boris Nemtsov shot dead: Outspoken Putin critic who had expressed fears for his life is killed near the Kremlin
iJobs Money & Business
£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...
Voluntary post, reasonable expenses reimbursed: Reach Volunteering: Would you ...
£36,000 - £40,000: Christine McCleave: Are you looking for a new opportunity a...
£15000 - £18000 per annum: Recruitment Genius: This is a great opportunity for...