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Lubricants add shine to Burmah Castrol results

Robert Cole
Monday 11 April 1994 23:02 BST
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A STRONG performance at Castrol, the lubricants business, fuelled growth at Burmah Castrol, the engine oil and chemicals concern, which reported pre-tax profits of pounds 194m in 1993, an advance of 18 per cent, writes Robert Cole.

However, the figures were flattered by movements in exchange rates. Analysts estimated that underlying increase was less than 10 per cent.

The company said the performance of Castrol in North America and South Asia was particularly good. Lawrence Urquhart, the chairman, said trading had been encouraging but it would be rash to count on a swift economic recovery in Europe and Japan. Earnings per share rose 35 per cent to 54p and the final cash dividend was increased to 11p, making a total of 27.5p compared to 26.3p.

For the second time Burmah is poised to relieve surplus payments of advance corporation tax by encouraging shareholders to take shares instead of cash in lieu of dividends.

The scrip dividend alternative is pitched at a 50 per cent premium to the cash payment and would save about pounds 4m in tax. Taken with the saving already made, the enhanced scrip will reduce Burmah's ACT surplus from pounds 31m to about pounds 19m.

Bottom Line, page 28

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