IWP International, the household products group, has reported a marginal 3.3 per cent rise in pre-tax profit from €11.5 million (£9.06 million) to €11.9 million (£9.37 million) in the six months ended September 30th 2000. "By focusing on our brands, third party brands and added value private labels, we can maintain and improve our margins over the medium and longterm," said chief executive Mr Joe Moran. The restructuring of the business will be completed this year.
Brokers are forecasting an earnings per share (eps) growth of some 5 per cent this year compared with 2.1 per cent in the first half. This is expected to amount to 12.5 per cent in 2001.
Asked about a management buyout (MBO) of the company as an alternative to the low share price, Mr Moran said this was always an option. However, he will continue to build up his stake in the company. IWP, he added, will also continue to buy shares but this will depend on the value of the shares.
The latest results show a 12.4 per cent rise in turnover of the continuing operations from $244.3 million to €274.7 million. Despite the low profit growth, the interim dividend per share is being raised by 7.5 per cent from 3.72 cents to 4.00 cents. A breakdown of the divisions shows only one of its three divisions - household products - recording a rise in both sales and profits. Household products, the largest division showed a rise in sales from €111.7 million to €136.8 million while operating profits grew from €6.1 million to $7.1 million. In personal care and cosmetics, sales rose from €77.9 million to €78.6 million but operating profit fell from €8.6 million to €8.1 million. The first half saw a rationalisation of the business which has resulted in a "clear and focused strategy based around niche brands and value adding private label partnerships". Prospects for this division are described as positive and it sees considerable potential for its cosmetics business.
Distribution and labels saw a fall in sales from €72.6 million to €59.4 million and a decline in operating profit from €4.6 million to €3.8 million. IWP said the division changed considerably over the past 12 months following the disposal of 3 businesses. The development work in Poland continues but development costs will adversely affect the short-term performance. Putzfield, the speciality business, "continues to perform very strongly".
