Wedgwood restores payout as profits double

BY MAGNUS GRIMOND

Waterford Wedgwood has chosen the bicentenary of the death of its famous co-founder, Josiah Wedgwood, to announce a return to the dividend lists after an absence of seven years.

The shares rose Ir3p to Ir54p after the Irish crystal to upmarket crockery group said it was to pay a higher-than-expected dividend for 1994 of Ir0.8p. Analysts in Dublin had been forecasting that the first payout since 1988 would be just Ir0.5p.

The news came as Waterford, which is based in the eponymous County Waterford in Ireland, revealed that pre-tax profits had more than doubled from Ir£10.1m (£10.4m) to Ir£22.6m (£23.3m) in the year to December.

The strong profits of the past two years follow four years of losses and extensive restructuring. Since 1989, the group's workforce has been cut by 29 per cent to 7,415, with the Wedgwood side alone losing over 2,100 jobs.

But the chairman, Dr Tony O'Reilly, who through Fitzwilton controls nearly 15 per cent of the group, said yesterday that the strategies they had implemented at Wedgwood were now producing a more satisfactory result.

Operating profits from Wedgwood leapt from Ir£8.7m to Ir£15.3m, while the Waterford Crystal business chipped in Ir£7.8m, up from Ir£13m.

Kneale Ashwell, chief executive of Wedgwood, said the figures had been boosted by better controls and greater automation at the tableware group. But Wedgwood has also dumped unprofitable downmarket and inappropriate lines, such as metal saucepans, in its retail outlets and has introduced more "mid-market" products.

Mr Ashwell indicated that the period of shake-out at the group was now, in effect, at an end. He also played down rumours that Morgan Stanley might want to dispose of its near-15 per cent stake in Waterford.

Earnings per share jumped from Ir1.27p to Ir2.9p last year, while gearing has been slashed from 41 to 27.5 per cent.