Heiton raises profit by 16%

Heiton Holdings, the builders merchants and DIY group, has reported a 16 per cent increase in pre-tax profits to £12

Heiton Holdings, the builders merchants and DIY group, has reported a 16 per cent increase in pre-tax profits to £12.8 million (€16.3 million) on a turnover of £206.7 million (€262.5 million) for the year to April 1st.

The 25 per cent growth in sales reflects continued favourable market conditions in construction and home improvements although the rate of increase in pre-tax profits is less than the 25 per cent increase achieved last year. Adjusted earnings per share (eps) were up by 29.5 per cent to 20.74p. The new group chief executive, Mr Leo Martin, said that, over the past five years, eps had grown an annual compound growth rate of 41 per cent and the stock's performance had been in the top ten of ISEQ stocks.

Commenting on the 14.5 per cent interest that Grafton Group has built up in Heiton over the past four months, Mr Martin said he had no other information other than Grafton's statement that the stake had been acquired for investment purposes only. "Nor have we received any approach from them," he said. Heiton, meanwhile, remains committed to exploring the emerging Polish market. Mr Martin said there were two people continually "on the ground" in Poland, seeking a joint venture partner in the "under-developed and highly fragmented" merchanting sector.

The board has recommended a final dividend of 3.07p, bringing the total dividend to 6.07p, up 23.9 per cent on last year.

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Of its Irish divisions, merchanting & hire contributed £140 million of turnover, up 9 per cent on 1998, steel, £21.9 million, up 3 per cent, and DIY, £19 million, up 17 per cent. Irish operating margins rose from 8.6 per cent to 9.1 per cent. Overall, operating margins only increased from 8.6 per cent to 8.9 per cent because of lower margins in Britain.