Waddington makes 7.4m pounds provision for US litigation

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The Independent Online
JOHN WADDINGTON has set aside pounds 7.4m to cover the potential cost of the anti-trust investigation by the US Department of Justice into alleged price-fixing of disposable plastic cutlery made by two of its subsidiaries.

The company, which is best known for its Monopoly board game but is principally a maker of packaging, also disclosed yesterday that it had considered making an offer for Spear, the games company subect to bids from Hasbro and Mattel, two US toy companies.

David Perry, chairman, said: 'We looked at the numbers being bandied about. But with Hasbro owning 20 per cent, we concluded it did not make sense to get involved.' He said the anti-trust provision would cover a possible fine of dollars 4.2m ( pounds 2.8m), legal expenses and potential civil actions against Comet Products and Comet California Cutlery.

The provision, coupled with a separate pounds 3.8m charge for losses on future disposals, severely dented Waddington's results for the year to 2 April.

Pre-tax profits were pounds 8.1m, against pounds 6m in the previous year, which was also overshadowed by pounds 9m of write-offs.

Analysts, however, expect profits to rise to pounds 21.5m this year, which equates to underlying growth of slightly more than 14 per cent.

The final dividend is being lifted from 4.3p to 4.7p. Shares rose 5p to 238p.

Waddington originally announced that the anti-trust investigation was under way in January. Since then it has discovered that a competitor had agreed to co-operate with the authorities by providing information in exchange for leniency.

Russel Greer, vice-president of Comet California, has subsequently had discussions with the authorities about a plea agreement arising out of his involvement in the alleged offence.

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