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Bottom Line: Usborne slips out

Monday 18 April 1994 18:02 EDT
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IT IS highly inappropriate that Usborne, the food manufacturing company, has been allowed to have trading in its shares suspended.

It is understood that the Stock Exchange granted the suspension because a profit warning published yesterday threatened the maintenance of an orderly market in the company's shares.

But while Usborne's announcement lacks specific numbers, it contains enough information for shareholders to conclude that the company is in poor shape.

Usborne admits that the bottom has fallen out of its pigs business and that the internal management of that business has been found wanting.

It also confesses that it is likely to report a substantial loss for the six-month period to 31 December.

Usborne's operational woes are sure to hurt shareholders. Withdrawing the facility to trade shares only compounds the trauma.

It is also hard to see how the market can be kept any more 'orderly' when the time comes for investors to react to the bad news.

The Exchange has tightened up on suspensions in recent months. This is to be welcomed, but Usborne is one that has slipped through the Exchange's net.

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