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HSS helps Davis to 25% rise in profits

Tom Stevenson
Thursday 17 March 1994 19:02 EST
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A FIRST-TIME contribution from HSS, the former John Mowlem plant hire operation, helped Davis Service Group to post a 25 per cent increase in profits last year, writes Tom Stevenson.

Stripping out HSS's pounds 2.9m profit since its purchase in May 1993, the rest of the business services company returned steady profits.

After more than halved interest payments, thanks to the disposal in 1992 of Godfrey Davis, the vehicle contract hire business, pre-tax profits increased to pounds 21.8m ( pounds 17.5m).

Earnings per share, diluted by the paper element of the HSS acquisition, rose marginally to 15.13p (15p) and the dividend was unchanged at 7.98p.

Neil Benson, chairman, said that increased activity in hotels and restaurants, to which the textile division rents linen, had not been able to make up for lower prices.

A pounds 1m shortfall in textiles offset a better result from the site services division, which rents mobile buildings. It increased sales and profits despite poor demand and prices.

Pall Mall, the cleaning arm, increased profits by 20 per cent, but Mr Benson warned that employee protection regulations had slowed the rate at which the public sector was contracting out services.

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