Tibbett & Britten ahead

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DESPITE recession in the high street Tibbett & Britten, the distribution company for many retailers, has increased interim profits on turnover up 20 per cent, writes Russell Hotten.

Although it won several new contracts, John Harvey, chairman, said almost all the increase in turnover came from growth in existing business in the UK and abroad. He said the difficult economic climate put pressure on margins, but restructuring and new contracts would sustain the group's growth.

Cost-cutting did not stop the rot at T&B's clothing distribution operation, suffering because of the depressed sector, but elsewhere the businesses developed strongly.

The company expanded operations for B&Q and J Sainsbury and won new UK contracts from Digital Equipment Company, Trebor Bassett and CRS Housewares.

Taxable profits for the first half to 27 June rose 6 per cent to pounds 6.7m, and analysts are maintaining full-year forecasts at about pounds 14.5m. Turnover topped pounds 100m.

One analyst said: 'Given the area it works in T&B has gained new contracts at an impressive pace, so these will feed through into the second half.

'At those parts of the business where it has had problems the company has made the best of a bad job.'

In Canada, T&B opened two warehouses ahead of schedule and won business from the drinks firm Perrier, and Lindt, the chocolate maker. At the end of June it created a South African division to pay pounds 2m for Unilever's warehousing services, with a turnover of about pounds 12m.

T&B is in talks with Woolworth to run its food supply operations in South Africa.

The company is paying a dividend of 3.8p (3.4p), with analysts forecasting about 10p for the year. Earnings per share rose 4.5 per cent to 12.8p.