Mail order side boosts GUS to interim pounds 213m
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Your support makes all the difference.A STRONG performance from mail order, Burberrys and Scotch House helped Great Universal Stores to a 9.4 per cent increase in pre-tax profits to pounds 213.2m in the six months to September.
The British catalogues business - where titles include Kays, Marshall Ward and Family Album as well as Great Universal - boosted operating profits by 22 per cent to pounds 68.5m on sales just 4.8 per cent higher at pounds 818.4m.
However, in Europe, which accounts for about a quarter of the catalogue division, sales and profits were flat in local currency terms. GUS is introducing greater co-ordination of products, catalogue printing and administration between Europe and Britain. Richard Pugh, deputy chairman and head of the division, hopes this will help maintain profits.
Profits from Burberrys and Scotch House rose from pounds 8.5m to pounds 13.1m. The group said that Britain and the US showed an encouraging increase, with September particularly good. It has also been expanding its Burberrys franchise operations in China.
The group generated about pounds 140m cash during the period, increasing its cash balances from pounds 1.4bn at the year-end to pounds 1.5bn. But lower interest rates meant that interest earned dropped from pounds 58.5m to pounds 51.6m. The City is hoping that the group will either make a significant acquisition, or pay a special dividend to shareholders, with the money.
GUS is increasing its interim dividend by 16 per cent to 4p. Earnings per share were ahead 10.8 per cent at 14.3p but shares still closed 9p lower at 573p.
The group spent pounds 60m on property during the period although completion was too late to impact on the figures. However, rental income rose to pounds 26.8m and the group expects the year valuation to be above last year's pounds 688m.
Bottom Line, page 32
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