Powerscreen International, the Northern Ireland-based engineering group, has recorded a 15.2 per cent rise in pre-tax profit from £20.45 million sterling to £23.6 million in the six months ended September 30th, 1997. The results have been described by the group as "pleasing against the background of a number of difficult conditions". Moreover, the "decision to increase manufacturing operations outside Britain has helped underpin growth". Sales grew by 12.5 per cent from £151.6 million to £170.5 million. Earnings per share rose from 17.3p to 19.7p and reflecting the growth, the interim dividend is being raised from 2.8p to 3.1p.
There is no contribution from Moffett Engineering as it was only acquired in the middle of September. However, it should make a contribution in the second half. Overall order books are "healthy" and current trading is described as "strong" and ahead of last year, the interim statement said. While Powerscreen does not foresee any improvement in mainland Europe in the second half, demand in both the North American and UK/Irish markets is bouyant. The product range and market coverage "is stronger than ever and should ensure a successful year". Asked about further acquisitions, finance director, Mr Barry Cosgrove, said nothing is imminent. There may be some small bolt-ons but nothing significant. Powerscreen was adversely affected in mainland Europe where sales fell from £39.3 million to £23.8 million in the first half. This was due to the strength of sterling and a lower level of economic activity in Germany, according to Mr Cosgrove. This, however, was more than compensated for by expanding demand in the US and the UK.
Reviewing the different divisions, the interim statement noted that operating profit in screening rose from £13 million to £14.2 million, while sales went up from £63.9 million to £70.9 million. The North American and UK/Ireland markets were very buoyant. In contrast, the markets in mainland Europe were slow but greater efficiencies from enhanced production facilities countered this. Operating profits in the crushing division fell from £3 million to £2.6 million, reflecting the difficult trading in mainland Europe. The UK market, however, experienced improved levels of activity.
The material handling division had the best performance. Sales rose 20 per cent to £77 million and operating profit jumped from £4.8 million to £7.5 million. Significantly, margins improved from 7.5 per cent to 9.6 per cent. Powerscreen is in a relatively strong financial position, with a gearing of 15 per cent.
