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Commenting on the results, the Chairman of Norish, Brian Joyce said: ?oThe business has gone through a period of consolidation and we are in a better position than twelve months ago with a reduced cost base, increased capacity and lower borrowings. Current trading is better than last year but markets remain difficult. We are meeting our immediate objective of steadily improving the company´s operations.
The improvement in profitability achieved by the Group in the second half of 2001 continued into the first half of the current year. Pre-tax profits for the six months ended 30 June 2002 were £0.4 million compared with a pre-tax loss of £0.2m in the same period last year. Adjusted earnings per share increased to 2.2p from 0.3p. An unchanged interim dividend of €1.27c has been declared.
Turnover increased marginally to £6.6m compared with £6.5m. Determined action by management in reducing costs and generating replacement sales played a key part in improving profitability. Ongoing investment to enhance efficiencies also contributed to the better profits. These were achieved in very competitive markets and in the face of significant external cost increases, particularly in the area of insurance.
Gross profits increased by 34 per cent to £0.7m compared with £0.5m following a 2.5 per cent reduction in the cost of sales. An exceptional gain from rate rebates of £0.2m was reduced somewhat by an exceptional loss from the sale of land at Bury St Edmunds. The proceeds of this sale, amounting to £0.4m were used to reduce borrowings. This and stronger cash flow saw net debt fall to £4.2m from £5.7m, giving a debt equity ratio of 47 per cent compared with 64 per cent a year ago. Lower interest rates and improved cash management contributed to reducing net interest costs which were £0.1m compared to £0.2m.
The cold storage division performed well in a market still suffering from over capacity. The Bury St Edmunds and Braintree stores successfully attracted new customers and achieved high occupancy levels. The West Midlands store secured a profitable new contract from a major customer which replaces a labour intensive loss-making contract.
BWA performed better than last year with York trading particularly well. During the half year, £0.2m was invested in increased capacity to meet demand for additional volumes from major customers. Felixstowe had a disappointing first quarter and incurred significant costs in repositioning the business to take advantage of the company´s growth in the ambient warehousing market. Trading recovered well in the second quarter.
The interim dividend will be paid on 18 October 2002 to shareholders on the register on 27 September 2002.
Norish plc
Paul Byrne, Chief Executive Tel: 00 44 1737 221133
Murray Consultants:
Joe Murray / Grainne O´Brien Tel: 01 498 0300