The Investment Column: Booker
Wednesday 23 June 1999
The statement, following the group's change of year-end, marks the near- completion of the group's re-organisation after Stuart Rose took control of the troubled distributor in October. Since his arrival, he's notched up pounds 150m of exceptional charges incurred in slimming the group down to a focused cash-and- carry player.
Mr Rose says there will be no more operating exceptionals, but there may be some costs in the remaining disposals, a salmon farm and a US poultry business. He also expects debt to fall to under pounds 300m by the year- end. In the meantime, he has suspended dividends "for the foreseeable future".
Now he wants Booker to be the largest, most efficient, customer-friendly and profitable player in the business. So far it is only the largest and it faces some tough competition. Wal-Mart's imminent arrival could make the market even fiercer.
Analysts expect full-year profits of pounds 29m and earnings of 8.5p per share this year, putting the shares, down a penny at 87.5p yesterday, on a rating of 10. That sounds cheap, but Booker has much to prove and the rating is fair.
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