Waterford Wedgwood, the crystal, fine bone china and porcelain group, has recorded a marginal rise in profit before exceptional charges, from £40.0 million (€50.8 million) in 1997 to £40.2 million (€51.0 million) in 1998. The shares closed down three cents at 70 cents..

The results include a doubling of interest costs due to a restructuring programme and the acquisition of German porcelain manufacturer, Rosenthal. If these are excluded, the group increased its operating profit to £50.9 million (€64.6 million), indicating an underlying growth of 12.6 per cent. This is broadly in line with brokers' forecasts.

The results confirm that Waterford Wedgwood is not firing on all three cylinders. There were bumper results from Waterford Crystal and a somewhat better than expected performance from Rosenthal. However, Wedgwood curtailed the group's growth with a continuing slide in its operating profits. Also, the group has had to contend with restructuring costs of £24.6 million (€31.2 million), two-thirds of which is directed towards Wedgwood.

Overall sales grew by 38 per cent (7.3 per cent excluding Rosenthal) from £417.2 million (€529.7 million) to £575.3 million (€730.5 million).

Earnings per share grew by 10.4 per cent from 4.7p (5.97 cents) to 5.19p (6.59 cents), again in line with projections. A second interim dividend of 1.4p (1.78 cents) is being paid making a total of 1.8p (2.29 cents), a rise of 12.5 per cent. The crystal side generated more than double Wedgwood's operating profit. Waterford Crystal's operating profits have risen by 40 per cent from £23.7 million (€30.09 million) to £33.1 million (€42.03 million). Sales grew at the slower rate of 17.8 per cent to £217.6 million (€276.3 million). This has led to a widening of the operating margin to 15.2 per cent, before restructuring costs, surpassing its target of 15 per cent. The crystal company's performance was driven by its operations in the US with sales increasing by 14.5 per cent to $231.8 million (€214.6 million) in that market. Mr Redmond O'Donoghue, chief executive of Waterford Crystal, said its share of the US premier crystal market is now 50 per cent, up from 23.5 per cent in 1991. This has been achieved with the introduction of new products. New products contributed 25 per cent of group sales while new businesses contributed £18 million (€22.86 million) at wholesale level. Stuart Crystal which was loss-making when it was acquired in 1995, recorded an operating profit of £1.3 million (€1.65 million). The Waterford Crystal visitor centre again showed strong growth with 310,000 visitors. This was up from 100,000 in 1992.

Rosenthal recorded its first profit after tax, amounting to £3.3 million (€4.19 million). That was on a marginal growth in sales to £321.4 million (€408.09 million). While the German market was flat, sales grew in other areas with a 23 per cent growth in the US. The performance from Wedgwood was disappointing with a drop in operating profit from £21.5 million (€27.3 million) to £14.0 million (€17.78 million). Sales were 1 per cent down at £230.2 million (€292.29 million) but the fall was 5 per cent at constant sterling rates. It was hit by the recession in the Japanese market and the strength of sterling which pulled low cost imports into the British market, said chief executive, Mr Brian Patterson.

But all was not gloom at Wedgwood. US sales were up 5 per cent and the company now claims to have a 12 per cent market share - up from 8 per cent 18 months ago - making it number three. Sales in Canada and Australia were up 5 per cent.