Warning knocks UK Safety

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The Independent Online
SHARES in UK Safety, the army boots maker, slumped 14p to 51p yesterday after a profits warning, writes Robert Cole.

The warning follows an increase in the price of leather, the company's main raw material. Safety's fortunes have also suffered from declining demand from the Ministry of Defence. In 1992 the MoD bought 30 per cent of its output; that figure has now been halved.

John Newman, finance director, said the company was winning more sales but margins had narrowed because the company had been unable to pass the increased cost of raw materials on to customers.

Rowan Dartington, the Bristol- based stockbroker, has cut its profit forecast for the current year from pounds 2.5m to pounds 1.8m.

UK Safety gained its stock market listing in May 1993 by reversing into Television South West after the station lost its ITV broadcast licence.

UK Safety promised to maintain its dividend. It paid 2.6p last year. The same payment this time would mean the shares yield 6.4 per cent.