Annual profit at Fitzwilton surges 79% to £15 million
STRONG growth has been, achieved by Fitzwilton, whose main interests are Wellworth, the Northern Ireland in which it has a 12.9 per cent shareholding.
Preliminary results show a 79 per cent increase in pre tax profit from £8.4 million in 1994 to £15 million in 1995. The results are broadly in line with brokers predictions. The market, approved and pushed the shares up 3p to 48p.
Growth was partly influenced by an exceptional profit of £435,000 from the sale of Novum, its freezer manufacturing subsidiary, to management. An exceptional loss of £253,000 was recorded in 1994. However, even excluding the exceptional item, there was still very good underlying growth.
The profit increase reflects better performances from Waterford Wedgwood and Wellworth.
The present market value of the investment is £60 million (23.7p per share) compared with a balance sheet value of £47 million. So the group's net assets are understated by £13 million.
The attributable profit from Waterford Wedgwood is reflected in the share of profits of £4.6 million. This is not directly comparable with the £4.95 million previously because of the inclusion of Wellworth. Fitzwilton received a dividend income of around £1 million from Waterford Wedgwood last year.
Wellworth increased its sales by 5 per cent to £274 million sterling and pre tax profits grew by 12 per cent to £12 million, so margins improved.
Wellworth does not fear competition from Tesco or Sainsbury's. Asked about Wellworth expanding into the Republic, a spokesman said the company would expand further in Northern Ireland before considering the Republic. There had been, no contact with Dunnes Stores which acquired a 9.1 per cent stake in Fitzwilton a year ago.
Rennicks, its subsidiary which manufactures road signs, increased both sale and profits. It has expanded into architectural signs and its 1996 order book is strong.
Fitzwilton's sales rose from, £282.9 million to £305.1 million. Interest charges went up from £7.7 million to £9.39 million. Earnings per share grew from 2.18p to 4.26p. A final dividend of 1.3p net per share has been declared, making a total of 2.35p, up from 2.25p in the previous year. Net debts amount to £106 million which puts the gearing at 89 per cent before goodwill but rises to 460 per cent after goodwill. The interest cover is a comfortable 2.6 times.