Laird shares drop 20% as profits slump
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.SHARES IN Laird, the engineering group, fell by more than 20 per cent after the company said its first-half profits would be over 40 per cent lower than last year.
Laird said cost pressures in its sealing systems business meant that pre-tax profits for the six months to June would be close to pounds 20m, down from pounds 34.7m in the same period last year.
At last month's annual general meeting, Laird said profits in the first four months of the year were running at a lower level than in 1997. Yesterday, the company said that the position in its sealing systems division had deteriorated.
"This will result in a loss in these activities for the first half of 1998," the company said. The company added that its other activities, which in 1997 accounted for over 80 per cent of total profits, "are expected to produce results in the first half similar to those of the first half in 1997".
The company's shares fell 91.5p to 297p following the profit warning, but they recouped some of their losses later in the day to close at 306.5p. The shares had started the day at 388.5p.
Ian Arnott, Laird's chief executive, said the main problem was that initial costs of operating the new car body seal plant in the US had been higher than expected.
Mr Arnott said: "We're sending out more experienced technicians from our plants in Europe to assist the production management in the States. The problem will be solved. Once we get the plant sorted out, it will enhance the value of our businesses overall." He added: "We are monitoring the situation on a daily basis."
In addition, the company said start-up costs on new plants in France and Spain amounted to approximately pounds 2m during the period.
Laird also identified some difficulties in Germany, where planned cost reductions have yet to be achieved and where margins had been forced down by strong competition. The company said that senior management changes had been made in Germany.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments