Heiton Group boss hints at delisting
Clearly disappointed by the group’s rating, Mr Martin noted that Irish fund managers haven’t exactly covered themselves in glory by moving out of Irish stocks.
Asked if he would consider going private Mr Martin replied: “We consider everything,” but, “we have no plans at the moment.”
Shares in the company rose 12c to 2.30 by mid-afternoon after the group announced a good first-half performance against a difficult market background. Heiton’s share price has fallen by nearly 30% since the group issued its full-year results back in July 2002.
An added difficulty for the stock is the defensive 24% holding by Grafton Group that has taken liquidity out of the market.
Mr Martin made it clear yesterday the board will look seriously at the prospect if its rating fails to improve.
Ironically it was the Irish economy that saw sales ahead by 9.2% to 245m for the half year to 31 October 2002.
Operating profits rose 16% to 14.3m while Earnings Per Share pre-goodwill rose from 18.4c to 22.2c, an increase of 20.4%.
An interim dividend of 6.2c has been declared, 6.9% above last year.
Overall, Mr Martin expressed satisfaction with the “double digit growth in profits that increased earnings by a significant 20% over the period.
Recent Irish acquisitions, including Cork Builders Providers and Wright Window Systems, have performed above expectations
and helped boost the first-half outcome.
Heiton said the highlights during the six months were the performance of its core merchanting and steel businesses, that produced strong turnover and operating profits over the period.
Atlantic Homecare had a tough six months, hit by the bad weather and the distraction of the World Cup.
Competition in the market was increased by the arrival of B&Q in Liffey Valley and sited directly opposite one of Atlantic’s main stores.
However, Mr Martin believes the overall impact has been positive for Atlantic.
In Britain Heiton continues to struggle.
Poor market conditions and the impact of an unexpected dip in demand from key customers did the group no favours.
Overall the UK business accounted for just 43.3m of sales last year and that was down 2.5% which means about 90% of earnings still comes out of Ireland.
For the second half, the group is expecting a more subdued performance from Irish construction.
Strong housing continues while consumers are also expected to spend more on home improvements, boosting the group’s merchanting and DIY businesses in the months ahead.
