Vickers to cut payout

CITY followers of Vickers, which makes battle tanks and Rolls-Royce cars, are bracing themselves for poor interim results and a dividend cut this week, writes Chris Blackhurst.

In his first set of figures, Sir Colin Chandler, Vickers' chief executive, is likely to reveal an interim loss in the region of pounds 5m. Most of the deficit is expected to come from further cost provisions on Rolls-Royce, the troubled car division.

Sandy Morris of County NatWest reckons that Sir Colin will have no choice but to reduce last year's interim dividend of 3.7p to around 2p. Over at Carr Kitcat, Alistair Stewart claims the dividend could be a nominal 1p.

Mr Stewart says Sir Colin, the former head of defence sales at the Ministry of Defence, is 'proving something of a disappointment.' He was billed as a man who would do two things - win defence orders and take some tough decisions on Rolls-Royce's future, not being emotionally attached to the marque as was his predecessor, Sir David Plastow.

This has not yet happened, however. Rolls has been on the market for a year but is now believed to have been withdrawn from sale.