Better earnings forecast at IWP

IWP International, the household product and personal care products company, is expecting improved performance in the coming year, with the reorganisation of its household product division almost completed, the streamlining of its operations in Poland and an improvement in Dutch and German markets.

Mr Joe Moran, IWP chief executive, said the completion of a new £8 million distribution centre in Poland, the coming reorganisation of the personal care division and improved performance by the company in German and Dutch markets would all have an affect on the figures.

On the issue of a management buyout of the company, Mr Moran said that the situation was under overall review and that the management would always act in the best interests of the shareholders.

He again criticised Irish institutions' lack of investment in second-line stocks, saying that the trend of the principal institutional investors to reduce holdings in Irish equities was continuing, with some saying the Irish content of their portfolios will go down to 15 per cent. Seven IWP directors spent €6.7 million (£5.3 million) in February, buying almost 5 per cent of the company's shares on the open market, fuelling rumours of a management buyout.

Mr Moran said that the long-term value of the company will come out in the end and that, with adjusted earnings per share of 22.14p, it represented a good investment return for private investors.

IWP's share price fell by 75 per cent during 1998 and early 1999, dropping from a high of €5.93 to a low of €1.40 before a modest recovery to €1.77, at which the directors bought shares. It is now trading at around €2.05. Mr Moran said that when the company went to Britain to encourage investors to buy IWP shares, traders were reluctant to do so when they saw the withdrawal of Irish institutions.

Difficult markets in Russia, eastern Europe and Britain have hit IWP hard, with pre-tax profits falling almost 11 per cent to £22.8 million (€28.95 million) in the year to last March.