Business travel revival boosts Hogg Robinson: 'Eyeballing over gin and tonic' sees profit soaring to pounds 21.5m and improved payout

A REVIVAL in business travel helped Hogg Robinson, the business services group, to a recovery in pre-tax profits, from pounds 13.3m to pounds 21.5m, in the year to March.

Profits of the business travel division more than doubled to a record pounds 4.6m. The group also made exceptional gains of pounds 5.4m, with pounds 8.2m from the sale of its retail travel agency to Airtours, partly offset by restructuring and disposal costs of pounds 2.8m.

Brian Perry, chairman, said more businessmen were travelling, more were trading up, and discounting was coming to an end. He saw no long-term threat to the business travel market from new technologies.

'To complete a business transaction, you need to eyeball the man over a gin and tonic.'

Mr Perry said the group's management contract for Business Travel International - an international network of leading business travel agencies - was producing contacts, and new sales were strong. The trend was continuing in the current year.

The financial services division increased operating profits from pounds 5.2m to pounds 5.6m. Mr Perry said the group's pensions advice and administration business had done particularly well since the Maxwell affair. 'With confusion about pensions remaining, the opportunities for us are very strong.' Hogg Robinson also has a small direct insurer and recently acquired an outplacement specialist serving companies making redundancies.

Poor results at a Belgian freight subsidiary, now closed, and the Falkland Island shipping service saw the first decline in operating profits at the transport division.

Profits fell from pounds 6m to pounds 4.7m. The Falklands service continued to make a profit, but there were fewer military and construction cargoes.

Mr Perry said: 'Trading has been very strong in the first two months of this year.' The group was looking for acquisitions in all three areas.

The dividend rose to 7.1p from 6.6p, with earnings per share before exceptionals up 9 per cent at 15.3p. The shares fell 6p to 237p.

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