Cookson brings back dividend as FY pretax profit rises

UK refractories manufacturer Cookson Group PLC posted a 20% rise in full-year pretax profit for 2005 and resumed dividend payments. The company plans to pay a final dividend of GBP 0.05 a share follow…

UK refractories manufacturer Cookson Group PLC posted a 20% rise in full-year pretax profit for 2005 and resumed dividend payments. The company plans to pay a final dividend of GBP 0.05 a share following a successful restructuring. It last paid a dividend in October 2001. Headline pretax profit increased to GBP 101.9 million, above the market consensus of GBP 95 million, from a restated GBP 85.0 million in 2004. “With our continued cost reduction and restructuring programmes in all divisions together with a particular focus on the turnaround of the Precious Metals division, we expect an improvement in the overall performance of our continuing operations in 2006”, said chief executive Nick Salmon. “The disposal of Laminates should also improve the quality of our earnings”, he added. The company said it made “substantial progress” towards achieving its 2007 margin targets. Ceramics achieved a full-year margin of 9.9% and Electronics 10.5%. Sales from continuing operations, which exclude the Laminates and Speciality Coating Systems (SCS) businesses, fell slightly to GBP 1.48 billion from GBP 1.50 billion. It said there are one or two further smaller, potential business disposals in prospect and some further land and property transactions that it expects to complete in 2006. The group, which supplies products for printed circuit boards, ceramics for the steel and glass industries and precious metals for jewellery, added that it has reached its disposal proceeds target of GBP 100 million ahead of schedule. Net debt at year-end was GBP 292.3 million, GBP 29.5 million lower than the prior year, having been adversely affected by GBP 26.4 million of foreign exchange movements in the year, but benefiting from the gross disposal proceeds of GBP 29 million for SCS. Cookson made an additional “top-up“ payment of GBP 10 million into its UK pension fund in 2005 and plans further “top-up“ payments of GBP 10.5 million and GBP 12 million in 2006 and 2007.