Cookson announces profit advance of 50 percent; Preliminary announcement of audited results for the year ended Dec. 31, 1995.
Highlights of the results show a 50 percent increase in the Group's profit before taxation and exceptional items, a 29 percent increase in headline earnings per share and a 43 percent increase in operating profit.
In addition, Cookson announced a proposed final dividend of .071 cents per share and a total dividend of .125 cents for the year, which represents a 14 percent increase from the total of 11.0 cents for the year ended Dec. 31, 1994.
The Group's return on sales increased to 11.1 percent from 9.0 percent in 1994.
Highlights of the audited results are as follows.
1995 1994 Change
Turnover (sales) $2,826m $2,460m +15% Operating profit $ 314m $ 220m +43%
Return on sales 11.1% 9.0%
Profit before taxation and exceptional items $ 284m $ 190m +50% Headline earnings per share 29.6 cents 22.9 cents +29% Proposed final dividend 7.1 cents 6.0 cents +18% Total annual dividend 12.5 cents 11.0 cents +14%
Commenting on the results, Richard M. Oster, Group chief executive, said, "Global expansion is a key aspect of the Group's strategy. This, together with a clear focus on new product development and customer service, have enabled the Group to grow its major businesses despite the increasingly competitive environment."
Highlights of audited group results
Review of year ended Dec. 31, 1995
Group turnover for 1995 was $2,826.1 million against $2,459.7 million in 1994, an increase of 15 percent. At constant exchange rates and adjusting for the effects of acquisitions and disposals, group turnover showed organic growth of 11 percent over 1994.
Group operating profit for 1995 increased by 43 percent of $314.5 million compared with $220.3 million in 1994. On a comparable basis, adjusting for exchange rates, acquisitions and disposals, the organic growth in operating profit was 30 percent.
Return on sales for the period was 11.1 percent compared with 9.0 percent in 1994. Group operating profit increased for the eighth successive half year as a result of the focus on, and of the investment in, businesses in high growth markets for which Cookson produces high margin, quality products and from the continued effort to improve operational efficiency.
Group profit before taxation and exceptional items of $284.5 million exceeded by 50 percent the $189.2 million achieved in 1994.
The board has proposed a final dividend for 1995 of 7.1 cents per share (1994: 6.0 cents), making a total of 12.5 cents for the year (1994: 11.0 cents), an increase of 14 percent over the previous year. The final dividend will, if approved, be paid on May 30 to ordinary shareholders registered on April 2. A scrip dividend alternative will again be available.
Global expansion is a key aspect of the Group's strategy. This, together with a clear focus on new product development and customer service, have enabled the Group to grow its major businesses despite the increasingly competitive environment. The strong trading performances achieved in the electronic materials businesses in 1994 continued into 1995, with the division producing record results. The complementary acquisitions made during 1995 have been integrated effectively and have performed well and in line with expectations. Both sectors in the ceramics division produced record results in 1995; the Advanced Refractories operations commissioned in recent years are all now contributing to significant organic growth in sales and profit; in its first full year of trading Cookson Matthey Ceramics has made outstanding progress exceeding expectations for this strategic initiative. In the engineered products businesses, record results were enhanced by the first full year's results of the UK precious metals operations acquired in 1994 from Johnson Matthey. In plastics, better than expected results were achieved from the 1995 acquisitions, but under-performance in the fibre optic cable and commercial carpet fibre businesses held back an otherwise strong performance. Continued investment will build further on the strong market positions currently held by all of the Group's major businesses.
In October 1995, the Group completed the disposal of its metallic stearates business, Synthetic Products Company (Synpro), to Ferro Corp. for a total consideration of $96.4 million. Also in October, the Group implemented its decision to exit its U.S.-based lead stabilisers business. The profit arising on the net assets of Synpro disposed, offset by the losses arising on the disposal of businesses, amounted to $6.9 million. After charging the goodwill associated with the disposal of Synpro of $25.4 million, the total exceptional loss arising on sale or termination of operations in 1995 amounted to $18.5 million. Also shown as exceptional items in 1995 were $1.7 million of net losses in disposal of fixed assets.
Interest costs were $30.0 million in 1995, compared to $31.1 million in 1994. The taxation charge for 1995 was $95.8 million compared with $57.5 million in 1994 which, after adjusting for the effects of exceptional items, represents an underlying tax rate for 1995 of 30.4 percent compared to 30.7 percent in 1994. The 1994 tax charge included an amount of $9.9 million in respect of Advance Corporation Tax written off. No write off was made in 1995.
Headline earnings per share, which reflect earnings before the effect of exceptional items, increased by 29 percent 22.9 cents in 1994, as restated for the 1995 rights issue, to 29.6 cents in 1995. Without adjustment for the exceptional items, earnings per share were 25.1 cents in 1995 compared with 3.9 cents in 1994, as restated. -0-
Note: All U.S. dollar figures were converted from pounds sterling using an exchange rate of 1.57.
CONTACT: Stuart Daniels, 401/521-1000
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|Date:||Mar 7, 1996|
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