Sheffield to leave Portals mansion: Committee to decide whether to raise chairman's pay

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The Independent Online
JULIAN Sheffield is to leave Laverstoke House, the Hampshire country mansion with two acres of garden and surrounded by 4,000 acres of tenanted farmland, which forms part of his remuneration as chairman of Portals, the papermaking group.

He intends to depart by August 1996 and move to a house he bought nearby four years ago.

A company spokesman said it was up to Portals' remuneration committee to decide if the pounds 120,000-a-year cash part of Mr Sheffield's salary would increase after he leaves the house, estimated to be worth more than pounds 5m. Its gardens sweep down to the banks of the River Test, famed for its trout fishing.

Mr Sheffield's living arrangements were disclosed during the recent unsuccessful takeover approach made by De la Rue, the security printing company.

Portals has never disclosed the amount of rent paid by Mr Sheffield. A fair rent would be about pounds 100,000 a year, according to estimates by estate agents. Analysts questioned the company about the arrangement after yesterday's results for the six months to June were published. Taxable profits rose from pounds 13.5m to pounds 16.2m, and the interim dividend is being lifted 9.5 per cent to 5.75p.

Portals allayed analysts' concerns about this year's sharp rise in raw material costs, particularly wood pulp, which has risen 40 per cent since January to dollars 700 (pounds 454) a ton. Prices for various forms of cotton waste have also climbed.

'These will have some effect on margins in the second half of the year as our markets take time to adjust,' said John Lloyd, managing director. However, he said Portals' use of raw materials such as abaca, the price of which is stable, would help to ease the pressure. Raw materials account for 20 to 25 per cent of costs.

'In papermaking we would be happy with profit margins of 19 to 20 per cent. We expect to be in, or close to, that range at the year-end,' Mr Lloyd predicted. Analysts expect annual pre-tax profits to rise by around 15 per cent to pounds 35m. Shares rose 20p to 675p.

Portals said demand for paper with security features such as weaved strips and watermarks was increasing, and it expected a knock-on effect from the US government's decision to incorporate a portrait watermark on dollar bills for the first time.

While only US-owned companies may bid for that work, Mr Lloyd said awareness of the need for security paper had risen increased because of the American government's decision.

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