Bottom Line: Expanding Filofax

FILOFAX'S profits are upwardly mobile again. From losing money as the yuppie bubble burst at the end of the Eighties it announced a 48 per cent jump in pre-tax profits yesterday to a record pounds 3.3m and a rise in dividends from 1.25p to 1.75p.

Having rejuvenated a tired- looking, sophisticated piece of branded stationery and eliminated an out-of-control cost base, what can the management do for an encore?

Acquisitions, of which there were four in the year, will obviously help. But Filofax has really exhausted the list of worthwhile purchases in the UK and it will have to cast its acquisitive net further afield.

This should not be too much of a problem. Filofax is such a strong brand name that it ranks second in many markets.

Filofax is also co-operating with makers of its electronic equivalents. Digital information in the Lotus Organiser, for instance, can be printed out on paper inserts for a Filofax.

Recent acquisitions, co-operation agreements and product innovations such as time planners should see Filofax make pounds 4.3m this year.

This, though, is already reflected in the share price at 213p and a prospective p/e of 17.

Fully valued should be pencilled in on today's page, with a reminder to review the situation if Filofax makes an important acquisition.