Falkland Island beats expectations

Falkland Islands Holdings said all three of its trading businesses performed well last year in extremely tough market conditions.The company, which gas retailing, property, insurance, hotels, shipping and fishing agency services on the Falkland Islands, saw underlying profit before tax in the year to 31 March 2010 came in ahead of expectations. Excluding non-trading income, which includes a £3.1m profit on the sale of shares in Falkland Oil and Gas Limited (FOGL), the company's profit before tax rose to £2.7m from £2.3m the year before. Market expectations had been for profits to remain flat.The company's Momart division was the best performer, growing operating profit 11.6% to £0.96m from £0.86m the year before, despite revenue sliding 15.9% to £13.07m.The Falklands division was operating profit jump 9.5% to £1.38m while the Portsmouth Harbour Ferry business grew operating profits by 1.3% to £0.79m.Revenue came in bang in line with market expectations at £29.22m, down from £32.25m the year before.The company is proposing the payment of a final dividend of 5p, which would make the full year pay out 9p, up from 8p the year before."Whilst we expect the forthcoming year to be challenging, we are confident that the diversity of the group's portfolio places it in a strong position to benefit in the medium term as the wider economy recovers," said David Hudd, chairman of Falkland Islands."With drilling underway on the Toroa prospect in the South Falklands basin, we are nearer to determining the full potential of our stake in FOGL. Although a deep water rig will be required for FOGL's other prospects, the ongoing drilling activity will continue to boost demand in the Falklands," Hudd added.