Whitecroft passes dividend

LOSSES of pounds 41.8m at Whitecroft have forced the mini-conglomerate's new management to pass the dividend, writes Topaz Amoore. Withdrawal from home improvements cost pounds 29.3m and there was an pounds 11.4m write- down on its property portfolio.

Last year Whitecroft's restated losses before tax were just pounds 3.6m and it paid a 4p dividend. But the markets were prepared for the worst after the company warned of the charges to come at the interim stage, and the shares closed down just 2p at 47p.

Michael Derbyshire, the new chief executive appointed in March, said the group had returned to profitability in the last quarter of the year to 31 March. Continuing businesses generated operating profits of pounds 2.6m while weak and loss-making activities had been eliminated.

'We've bottomed this one. It's been a year of major change but there'll be no further provisions and no further restructuring needed. We will restore dividend payments as soon as there is a firm trend of profitability', he said.

Whitecroft has also withdrawn from precision engineering and house building to concentrate on commercial lighting, doors and windows, medical cotton fibre and textiles. It has cut operating units from 30 to 18.

It paid interest of pounds 3.7m on borrowings that were cut to pounds 36.4m at the year- end from pounds 43m at the interim stage. Debt has now fallen to pounds 35m and Mr Derbyshire said that figure would be helped by any property disposal.

The property portfolio was revalued last year by independent advisers, Hillier Parker. Mr Derbyshire said they had received offers for a number of its developments but did not intend to release property at distress prices.