African volatility hits Paterson

ABOUT pounds 1.4m was wiped off full- year taxable profits at Paterson Zochonis, the toiletries company, following a 40 per cent devaluation of the Nigerian nair in March.

The company, which makes Imperial Leather soap and has extensive interests in west Africa, said it had no plans to run down its Nigerian interests because of the volatility.

Despite the devaluation Paterson still managed a pounds 1.3m increase in pre-tax profits to pounds 26.6m in the year to 31 May. Turnover increased 5 per cent to pounds 227m. Operating profit rose from pounds 9.8m to pounds 16.1m.

Although profits were helped by the elimination of loss-making business last year in Senegal and Ivory Coast, about 25 per cent of sales are in the region. The family- run company, formed in Africa in the 1850s when a Scottish businessman teamed up with a Greek, remains firmly rooted in west Africa, said Alan Whittaker, finance director.

He said the Kenyan manufacturing operations, which produce detergents, fridges and air conditioners, performed well.

In the UK, Cussons, which has about 23 per cent of the toiletries market, saw 'modest gains in turnover and profit,' Mr Whittaker said. Its Imperial Leather brand has 16 per cent of the soap market.

The Australian market continued to be depressed, but Cussons made gains in both turnover and profits, Mr Whittaker said. Sales in south-east Asia were not moving ahead as fast as hoped.

The final dividend of 9.20p makes 11.45p for the year. Earnings rose to 33.79p (32.19p).

The shares were unchanged at 370p.