Slimma boosts Dewhirst result

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The Independent Online
DEWHIRST Group, the garment maker, shrugged off tough trading conditions to report a sparkling first-half performance to 17 July.

Taxable profits soared 180 per cent to pounds 2.4m on a 48 per cent jump in sales to pounds 81m.

Tim Dewhirst, chief executive, said the result reflected a first full half-year profits contribution from Slimma, the women's fashionwear business acquired for pounds 14m last autumn.

He said Slimma had been sucessfully integrated into the group and was performing in line with expectations.

Despite static sales in menswear and a downturn in children's clothing and toiletry textiles, the group's underlying businesses raised their profits thanks to cost-cutting and tight control over stock levels.

The company has also been helped by a strong customer base, with Marks & Spencer accounting for 80 per cent of its annual turnover.

Interest costs rose from pounds 306,000 to pounds 365,000 due to borrowings of about pounds 4m at the halfway stage.

But improving cash flow is expected to return the group to pounds 4m net cash by the year-end, the same as in the previous year.

Earnings improved 112 per cent to 1.25p and the interim dividend is up 10 per cent to 0.32p.

Dewhirst expects further progress in the second half. 'Although consumer demand remains depressed the group is achieving higher sales, and with continued tight control of operating costs the board expects to report further progress during 1992-93,' it said.

The company is not planning to make any acquisitions and will concentrate on expanding existing operations.

Following last year's purchase, women's fashions and menswear each account for about a third of the group's sales. The balance is split between children's clothes, toiletry textiles and uniforms.

City analysts are looking for taxable profit of pounds 6m for the full year, compared with pounds 4.1m last year.

Despite a difficult economic climate the company is confident about its prospects.

The shares rose 4p to 40p.