Whatman disappoints with £15m restructuring costs

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Whatman, the laboratory supplies business which made a big acquisition a month ago, said it is axing 160 jobs and taking an unexpectedly high restructuring charge.

The company's shares tumbled 7 per cent on the news, which also included a warning that sales in the existing business had been disappointing over the past few months.

The sales disappointment prompted Bob Thian, the chairman, to sack the chief executive, Howard Kelly, in November. The head of European sales has also left. The unexpected charges announced yesterday include £700,000 to cover their pay-offs.

European revenues are about 3 per cent below the company's expectations, it said, although profits will come in as planned.

The main additional charge to hit the 2004 accounts - taking the exceptional items this year to £14.6m instead of the predicted £10m - comes from consolidating the paper operations of Whatman and S&S on a single site.

Mr Thian said: "The moment we went into S&S as an owner and looked under the skin, we could see that we were running two sub-optimal sites doing the same thing. It was a no-brainer."

Whatman is paying £34.6m for Schleicher & Schuell, which makes filters and screening products for use in laboratories. It bolsters the group's European and US operations.

Its shares were off 17.5p at 232p, taking the shine off a year in which they have climbed from 160p. Mr Thian said he regretted making the statement about disappointing revenues. "Overall growth is fine. We should have said it in January when we couldn't affect our investors' bonuses," he said.