The Investment Column: Rocky times at Redland

If anyone ever wanted a living definition of the word "embattled" they should look no further than Robert Napier, chief executive of Redland.

In five years at the head of the once-great aggregates and roof tiles, he has had to face a barrage of negative sentiment.

Yesterday, however, looked like being the coup de grace.

It was not that the City had not been braced for bad news.

RMC has been warning about a downturn there for some time, reiterating its view last week. But Redland's 13 per cent decline in underlying profits before exceptionals to pounds 71m for the half year to June was much lower than the lowest forecasts.

Even worse was the news that the slowing roofing market in Germany, which Redland dominates with a 40 per cent share, is going to fall further next year and the group may have to trim prices to maintain its position, sparking fears of a price war.

The problem for Redland is the feeling that management has done too little, too late to turn the group around in the wake of the disastrous pounds 1bn deal to buy Steetley in 1992. The group was dragged kicking and screaming into cutting its dividend by a third in March 1995.

With no rise in the payment since, and cover looking thin, that now looks to have been too timid and the company was having to deny wild rumours yesterday that another cut was in the air. But it is at Germany that most of the analysts' ire was being directed yesterday.

It has been clear for some time that the building boom from German reunification would eventually turn to bust.

Yet it has only been in the past year that Redland has really moved to get to grips with Braas, the majority-owned German roof tiles which has been the backbone of the group over nearly 10 years.

Even though the latest cost saving moves announced yesterday are expected to bring the total to be realised by 1999 close to pounds 60m, Redland is not in full command of its destiny, given that the new Redland Braas Building remains only 57 per cent-owned.

The only thing likely to save Mr Napier now is the absence of any credible replacements willing to put their head in Redland's noose.

If profits make pounds 200m this year, the shares, down 61.5p at 220p, stand on a forward price/earnings ratio of 11. With the dividend again in doubt, the only hope for holders is a bid. Otherwise avoid.


Actress sees off speculation about her appearance in an amazing way

Arts and Entertainment
Serge Pizzorno of Kasabian and Noel Fielding backstage at the Teenage Cancer Trust concerts
musicKasabian and Noel Fielding attack 'boring' musicians
Arts and Entertainment
Julianne Moore and Ellen Page are starring together in civil rights drama Freeheld
'Irritatingly Disneyfied': fashion vlogger Zoella
voicesVicky Chandler: Zoella shows us that feminism can come in all forms
ebooksAn unforgettable anthology of contemporary reportage

nflAtlanta Falcons can't count and don't know what the UK looks like
Arts and Entertainment
High notes, flat performance: Jake Bugg

Review: Despite an uphill climb to see Jake Bugg in action, his performance is notably flat

The Putin automaton will go on sale next month in Germany
videoMusical Putin toy showing him annexing Crimea could sell for millions
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

IT Systems Business Analyst - Watford - £28k + bonus + benefits

£24000 - £28000 per annum + bonus & benefits: Ashdown Group: IT Business Syste...

Trainee Recruitment Consultant - Birmingham - Real Staffing

£18000 - £23000 per annum + Commission: SThree: The SThree group is a world le...

Trainee Recruitment Consultant Birmingham

£18000 - £23000 per annum + Comission: SThree: The SThree group is a world lea...

Trainee Recruitment Consultants

£20000 - £25000 per annum + OTE £Competitive: SThree: SThree Group and have be...

Day In a Page

Indiana serial killer? Man arrested for murdering teenage prostitute confesses to six other murders - and police fear there could be many more

A new American serial killer?

Police fear man arrested for murder of teen prostitute could be responsible for killing spree dating back 20 years
Sweetie, the fake 10-year-old girl designed to catch online predators, claims her first scalp

Sting to trap paedophiles may not carry weight in UK courts

Computer image of ‘Sweetie’ represented entrapment, experts say
Fukushima nuclear crisis: Evacuees still stuck in cramped emergency housing three years on - and may never return home

Return to Fukushima – a land they will never call home again

Evacuees still stuck in cramped emergency housing three years on from nuclear disaster
Wildlife Photographer of the Year: Intimate image of resting lions claims top prize

Wildlife Photographer of the Year

Intimate image of resting lions claims top prize
Online petitions: Sign here to change the world

Want to change the world? Just sign here

The proliferation of online petitions allows us to register our protests at the touch of a button. But do they change anything?
Ed Sheeran hits back after being labelled too boring to headline festivals

'You need me, I don’t need you'

Ed Sheeran hits back after being labelled too boring to headline festivals
How to Get Away with Murder: Shonda Rhimes reinvents the legal drama

How to Get Away with Murder

Shonda Rhimes reinvents the legal drama
A cup of tea is every worker's right

Hard to swallow

Three hospitals in Leicester have banned their staff from drinking tea and coffee in public areas. Christopher Hirst explains why he thinks that a cuppa is every worker's right
Which animals are nearly extinct?

Which animals are nearly extinct?

Conservationists in Kenya are in mourning after the death of a white northern rhino, which has left the species with a single male. These are the other species on the brink
12 best children's shoes

Perfect for leaf-kicking: 12 best children's shoes

Find footwear perfect to keep kids' feet protected this autumn
Anderlecht vs Arsenal: Gunners' ray of light Aaron Ramsey shines again

Arsenal’s ray of light ready to shine again

Aaron Ramsey’s injury record has prompted a club investigation. For now, the midfielder is just happy to be fit to face Anderlecht in the Champions League
Comment: David Moyes' show of sensitivity thrown back in his face by former Manchester United manager Sir Alex Ferguson

Moyes’ show of sensitivity thrown back in his face... by Ferguson

Manchester United legend tramples on successor who resisted criticising his inheritance
Two super-sized ships have cruised into British waters, but how big can these behemoths get?

Super-sized ships: How big can they get?

Two of the largest vessels in the world cruised into UK waters last week
British doctors on brink of 'cure' for paralysis with spinal cord treatment

British doctors on brink of cure for paralysis

Sufferers can now be offered the possibility of cure thanks to a revolutionary implant of regenerative cells
Ranked seventh in world’s best tourist cities - not London, or Edinburgh, but Salisbury

Lonely Planet’s Best in Travel 2015

UK city beats Vienna, Paris and New York to be ranked seventh in world’s best tourist destinations - but it's not London