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Byline: By Andrew Howie

Boc, the industrial gases maker, last week posted a 6.8pc rise in pre-tax profits for the first half of its financial year as cost savings, positive pricing trends and acquisitions all pitched in to help.

Stripping out the effects of currency movements, sales improved in all five divisions including the Edwards semi-conductor equipment business where profits rose to pounds 4.5m against a forecast of pounds 4m.

The company demonstrated the resilience of the gases sector in a weak economic environment and although debt levels rose slightly this was mainly down to acquisitions. Chief executive Tony Isaac reported that firm pricing, ongoing cost reductions, successful implementation of new projects and good integration of new acquisitions all contributed to the company's performance during the period.

BOC remains committed to a progressive dividend policy and on this occasion investors were rewarded with a 2.6pc increase. Given the supportive yield of over 5pc and a low rating versus its peer group, BOC offers an attractive way of investing in a strong and well-managed company which is well-positioned to benefit from any upturn in global economies. We rate the shares a buy.

Formerly known as British Plaster Board, BPB is the world's leading manufacturer of plasterboard used in the building & construction industry.

Late last year the EU fined the company pounds 89m in a price-fixing investigation, however, the signs are that they have moved on and are looking forward to more prosperous conditions.

Over 80pc of profits are generated in Europe where plasterboard is rapidly usurping the more expensive practice of using wet plaster. The strength of the euro is currently making BPB's products very competitive.

BPB reports for the year ended March 31 on Thursday and on an undemanding price earnings ratio of 11 and a yield of 4.2pc the shares should be bought.

* Andrew Howie, investment manager at Wise Speke.
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Copyright 2003 Gale, Cengage Learning. All rights reserved.

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Title Annotation:Features
Publication:The Journal (Newcastle, England)
Date:May 19, 2003
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