Tranfood trips up Kleeneze
Article Date: Jul 11 2002Shares in mail-order and door-to-door retailer Kleeneze sparked up 3p to 113p in early play, despite investors being disappointed by below par full-year figures to April. James Crux reports.
Today's figures from fully-listed Kleeneze (KLZ) were a letdown because in April the board said pre-tax profits would be 'not less' than £8.5 million. They actually slid 40 per cent to £6.3 million, with most of the blame attributed to loss-making meat processing business Tranfood.
This firm caused a £1.5 million slide in pre-tax profits and was last month sold for a £2.3 million book loss. According to non-executive chairman Sir Clive Thompson, 'The business made £1.5 million in 2001, but barely traded profitably in 2002.'
Another unit to let the side down was gift and hamper seller Farepak, which saw its sales slide by 10 per cent and operating profits slump by 48 per cent to £1.6 million.
However, turnover at the three continuing businesses combined – Kleeneze, DMG and Farepak – put on 17 per cent to £197.2 million. Meanwhile overall group sales rose 14 per cent to £212.6 million.
Chief executive George Pollock calls 2002 a year 'of restructuring and refocusing' – a sentiment echoed by Thompson, who is chief executive of FTSE 100 stalwart Rentokil Initial. Thompson reckons that now that Kleeneze has disposed of the meat processing business it is much more focused and on track to deliver 'steady growth' this year.
This faith in growth in the months ahead was supported by a maintained total dividend of 8.36p.
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