Simon set to restore payout

BY RUSSELL HOTTEN

Simon Engineering, which last year peered into the abyss, said it hoped to pay its first dividend since 1992 this year, now that the bulk of its restructuring had been completed.

The company, whose operating profits are steadily improving, said the sudden decision in January to make further provisions would "definitely be the last".

Dr Maurice Dixson, chief executive, said: "We said 1994 would be the year to sort out problems and 1995 will be the year for the results to show through. That is happening."

He said the company, best known for making fire-fighting equipment, still had problems to sort out at the much-troubled Access division in the UK. "But we have done the disposals and all the major surgery."

Continuing businesses made operating profits of £4m before exceptionals of £6.1m. Discontinued operations, including exceptional costs of £4m, made a loss of £11m.

With wholesale removal of management last year, the trading performance of the core activities improved significantly in the second half. Access's US profits almost offset losses in other Access operations.

Overall, following an operating loss from continuing operations before exceptional items of £300,000 in the first half, the group made a profit in the second half of £4.3m. Total pre-tax losses were £18m, down from £160m last time.

Michael Davies, chairman, said: "The steadily improving trend of the second half of 1994 has continued into the current year, with all operations reporting strengthening order intake."

Gearing fell over the year from 264 per cent to 86 per cent, as borrowings dropped 40 per cent to £70.3m. The company said there were substantial accumulated tax losses available to reduce group tax charges in future years.

Mr Davies said Simon's divestment and closure programme was now complete, apart from the remaining activities of its Simon Petroleum Technology division. It planned to sell this business "at the right time." Shares rose 0.5p to 80.5p.