Technology costs hit Barbour

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The Independent Online
Barbour Index boosted its interim dividend and its shares rose, despite a 5 per cent profits dip and a warning that full-year profits would fall short of last year's.

Shares advanced 12p to 167p in the specialist information services company as it announced taxable profits of £1.93m (£2.02m) in the half year to October 1994.

The figures were struck after spending £502,000 on developing new electronic information services, principally for the depressed building industry.

Brian Griffin, chairman, said additional second-half costs of about £1.75m in developing the services meant Barbour's yearly profits would fail to meet the £2.9m made last year. That, in turn, was down on the £3.4m made in the previous 12 months.

Windsor-based Barbour, over two-thirds of whose sales are to the construction industry, has traditionally disseminated a wide range of information via books and microfiche.

However, the new electronic services would be unavailable this financial year, Mr Griffin said. Initial market reaction to test selling was encouraging.

Renewed contracts were up 3 per cent to 85 per cent in its construction sector. Renewals in Barbour's other sector, health and safety, dropped 2 per cent and are running at 83 per cent.

The chairman, declaring an interim dividend up from 2.7p to 2.85p as a sign of confidence, said sales were hit by cuts at big organisations.

"Typically," he said, "big organisations like British Telecom, the Ministry of Defence and hospitals might be taking two information services now instead of six."

Mr Griffin added: "The existing services, which are now showing modest growth, will provide a solid platform in terms of customers and cash for the launch of our new range."