James Halstead profit falls but it keeps dividend hike record intact

(Alliance News) - James Halstead PLC on Wednesday reported a decline in annual earnings and said "constrained" budgets in the education, healthcare and hospitality sectors are clouding its outlook in Europe.

The Manchester-based commercial flooring manufacturer and distributor raised its dividend, however, saying it still expects profit growth in the future.

Pretax profit in the year ended June 30 declined 1.9% to GBP55.1 million from GBP56.2 million. Revenue fell 4.7% to GBP262.0 million from GBP274.9 million.

"Despite headwinds in the commercial flooring sector it was a solid performance," Chair Mark Halstead said.

"Looking ahead, we have continuing product and process improvements and I, and the board, remain confident that the future offers many opportunities and on-going profitable growth."

James Halstead lifted its final dividend by 0.8% to 6.05 pence from 6.00p. Its total dividend amounted to 8.80p, up 3.5% from 8.50p. The firm said it is its 49th consecutive annual dividend hike.

The firm hails "key projects" during the year, including at the newly built Colchester Hospital in Essex, a rugby union stadium in Toulouse, France, and 'Real Madrid World', a football theme park in Dubai.

Looking ahead, the firm expects "continued growth in North America and forward momentum in Malaysia". However, in Europe, it is seeing "short-term ongoing headwinds". These are hurting "repair, renewal and roll-out budgets" that have already been tightened by employment costs in the education, healthcare and hospitality sectors.

Shares in the company were down 1.0% to 148.00p each in London on Wednesday morning, recovering from a steeper earlier fall.

By Eric Cunha, Alliance News news editor

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