Mr Joe Moran, the chief executive of household products group IWP International plc, has not ruled out a future management buyout of the group.

"We have decided on nothing," he said after the company's annual general meeting yesterday.

"Nothing is ruled in or nothing is ruled out."

Mr Moran's willingness to buy what he believes are undervalued shares has led to speculation that he may take the company private or lead an MBO.

Other directors also bought IWP stock last year and the company itself has been buying its own shares.

"We are convinced the market price does not reflect the intrinsic value of the shares," Mr Moran told the a.g.m.

"We would be better off buying shares at a price below their real value. Since the end of the year, we have purchased approximately 3.6 million shares.

"Second-line Irish stocks are not the flavour of the month but we are convinced value will win out in the end and the shares will be a good buy."

But he said the company had to strike a balance between buying its own shares and investing in the company's expansion.

"If you just take the short-term view, you couldn't do different than buy shares at the price they are at now, but you must balance that against the medium- to longterm view of wanting to expand business," said Mr Moran.

So far this year, the company has paid $5 million (€5.67 million) for a US business and €6 million on buying shares, he said.

"At the same time we will invest in capital expenditure this year in the region of £17£18 million," said Mr Moran.

Despite the 18.7 per cent rise in turnover, difficult market conditions continue to challenge the company, he added.

But he said the group's businesses are beginning to deliver cash flow again. While the advent of Wal-Mart and the presence of multiple chains have affected business in the UK, they are now offering opportunities for the company, said Mr Moran.

The group will market its Collection 2000 cosmetics brand in 100 Wal-Mart stores by next January.

"We hope to do business with Tesco soon," he added. IWP's strategy is to be a focused household products and personal care business following its restructuring and rationalisation programme during the past year, he said.

"We're putting the money into research and development, new products and patented products," he said.