Aga scraps divi as it feels heat of recession

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The Independent Online

The housing slump and middle-class belt-tightening have forced Aga Rangemaster to scrap its final dividend after profits almost halved. The maker of the cast-iron luxury cookers said yesterday that orders were down by nearly 20 per cent and that pre-tax profits fell to £14.4m in 2008 from £27.0m a year earlier.

The Solihull-based company said it would pay no final dividend to conserve cash and that its year-end £5.8m of cash meant it could weather the recession.

Even well-off consumers have reined in spending on "big-ticket" items as the recession has deepened. Sales of luxury kitchen goods are also closely linked to the housing market, which is expected to keep falling all year.

The company has cut costs as demand for cookers has fallen. Headcount in January was about 500 down on a year earlier, factories have reduced operating hours and spending has been cut. The 300-year-old company said it started the year reasonably well but that trading worsened sharply from September.