25 March 1999: British china and crystal glass group Royal Doulton Plc, which announced a major restructuring in December with the loss of 1,200 jobs, has said it did not expect to return to profit un…
25 March 1999: British china and crystal glass group Royal Doulton Plc, which announced a major restructuring in December with the loss of 1,200 jobs, has said it did not expect to return to profit until the second half of 1999. The group said that repositioning the business away from lower margin sales had started. However, weak consumer spending and strong competition would lead to sales this year much lower than those in 1998. “Given the degree and speed of change on which we have embarked, the related internal costs, and the normal seasonal pattern of trading, the board currently expects the group to make an operating loss in the first half of 1999 before returning to profits in the second half,” it said. Royal Doulton reported a 1998 pre-tax loss of UK 42.6 million following a restructuring charge of UK 47.7 million, after a profit of UK 6.2 million in 1997, on turnover of UK 238.8 million. It did not declare a final dividend and said it does not expect to pay out any dividends in 1999. The group said the process of re-engineering its business would not be “quick, easy or cheap”, and said a change of managerial culture was needed to succeed. “The group is coming from a long way behind, but providing it delivers to the consumer a high quality product, the strength of its brands will, over time, deliver good profits and therefore value to shareholders,” the group added. The company“s world-renowned brands include Royal Crown Derby, Minton, Royal Doulton and Royal Albert. Its chief executive, Patrick Wenger, was badly hurt in a motor accident in Australia last November and is not now expected to return to executive duties. As a result, “company doctor“ Hamish Gossart, appointed as chairman last year, will continue to oversee day-to-day management for the time being.