Salvesen gets Olympic boost

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The Independent Online
CHRISTIAN Salvesen, the distribution and specialist hire business, made pounds 1m by supplying lighting and air-conditioning equipment for the Barcelona Olympics. That helped it to an 11.9 per cent rise in pre-tax profits to pounds 40.4m in the first half of the year.

The contribution from Aggreko, its hire business, increased from pounds 11.6m to pounds 15.4m. In Europe, it attracted extra business at its Berlin and Dresden depots following the reunification of Germany, which has produced a spurt of construction work.

Retail distribution in Britain is still suffering from the recession, but new customers, such as Haagen-Dazs, and expansion into other areas - including distributing electrical equipment for customers such as IBM - meant it still managed to improve profits. In Europe, it won a new contract to distribute cigarettes for BAT, while a frozen-food distribution centre for Unilever has been successfully commissioned. Overall, the division's profits improved from pounds 15.5m to pounds 16.8m.

The performance of the manufacturing division was held back by the bricks business, where trading profits fell 40 per cent to pounds 1.5m. But the food services business, which freezes vegetables, mainly for retailers, improved despite a poor pea crop.

Salvesen has been investing in new generators and temperature control equipment and Aggreko accounted for the lion's share of the pounds 30.4m capital spending in the first half.

Despite that, the group's debt fell from pounds 80.8m to pounds 60.7m, 23 per cent of shareholders' funds. Chris Masters, chief executive, said it would consider acquisitions in its core areas of distribution and hire.

Earnings per share rose 12.3 per cent to 10.12p and the dividend was up from 2.9p to 3.2p.