4 - 10 May 2000

Farsons Group almost doubles profits

by Anthony Manduca

The Farsons Group yesterday announced a consolidated profit before tax of Lm907,000 for the financial year ended on 31 January 2000, up from Lm497,000 for the comparable period of last year. This result reflects lower costs of raw materials and increased efficiency throughout the businesses managed by Farsons, notwithstanding the difficult business environment in the sectors in which the group operates.

The turnover of the group for the year increased by six per cent to Lm21,271,000.

Earlier this year, Simonds Farsons Cisk distributed an interim dividend of Lm60,000 to holders of ordinary shares. The directors are recommending the payment of a final net dividend of Lm300,000 out of tax exempt profits, resulting in a total net dividend to ordinary shareholders of Lm360,000 (1999 - Lm210,000 net). During the year, Farsons redeemed the 8.5 per cent cumulative redeemable preference shares after distributing a pro-rata gross dividend of Lm66,000 to holders of these shares.

The directors also distributed a net dividend of Lm180,000 to the holders of the six per cent (net) cumulative redeemable preference shares in December 1999.

A statement issued yesterday said the board of directors is of the opinion that this level of profitability can be improved upon in the current financial year.

"The group has invested in various sectors of its activity in recent years, and continues to prepare to meet the challenges of a more liberalised market place.

"As a consequence, financial costs are still heavy, but the cash inflows from group operations have improved considerably," the statement said.