Waddington 20% jump takes shares to year's high

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The Independent Online
PROFITS have improved by 20 per cent at John Waddington, best known for its Cluedo and Monopoly board games but principally a packaging company.

Investors took heart from an upbeat statement on prospects, with the rise from pounds 12.5m to pounds 15.1m before tax for the year to 3 April falling in line with most analysts' expectations.

Waddington's shares finished 11p higher on the day at 230p, a high for this year. The dividend is being held at 7.9p, covered less than twice by earnings per share of 13.71p.

Martin Buckley, chief executive, said: 'Core packaging businesses performed particularly well in difficult markets, and international operations continue to contribute increasing profits.'

Operating profits from packaging increased from pounds 11.5m to pounds 12.3m, despite a slight dip in sales from pounds 125.7m to pounds 125.6m. Profit would have been up 16.5 per cent but for the loss of a 'major contract' in the labels operation.

Specialist printing lifted its profit contribution from pounds 4m to pounds 4.3m, but was held back by teething problems with new equipment. Those problems have been resolved and Mr Buckley said: 'Growth opportunities in direct mail for the financial services sector will enhance profits.'

The games operation generated 13 per cent of total sales and yielded 17 per cent of operating profits, albeit static at pounds 3.4m.

Mr Buckley said the company would benefit from the recent sale of the loss-making Waddington Business Forms business, the purchase of Carthage, a US maker of cups, plates and bowls, and a increase in sales.

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