Anglo United plans acquisitions to aid distribution

ANGLO United, the Coalite smokeless fuels and chemicals group, plans to expand its distribution network through a series of small acquisitions, writes Russell Hotten.

The cash-strapped group said it would fund them out of working capital built into the bank restructuring agreed early this year. Harold Cottam, chairman, said the company was under no pressure to make disposals and was trading well within the facilities of the restructuring.

In the six months to 30 September Anglo cut its losses to pounds 6.5m, against a pounds 22.6m deficit last time. Operating profit rose 27 per cent to pounds 5.7m, compared with pounds 4.5m previously. This was despite a decline of 3 per cent in sales revenue, to pounds 236.1m, due largely to lower volumes in the solid fuel distribution division. Last year's results included exceptional items of pounds 11.2m, principally restructuring and abortive disposal costs. There were no exceptionals this time.

Mr Cottam said a cost reduction programme should save pounds 9m in the full year. Interest charges of pounds 12.2m include pounds 3m non-cash interest in respect of deep discount loan notes, leaving pounds 9.2m of cash interest, compared with a charge of pounds 16.2m previously.

A rise in operating profits at the smokeless fuels and distribution division to pounds 4.8, from pounds 2.8m, was mainly due to cost-cutting. Liquid fuels and chemicals made an operating loss of pounds 0.4m ( pounds 0.2m). There is no dividend.