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Recovery lets BBA plan to expand

Tom Stevenson
Tuesday 05 March 1996 00:02 GMT
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The recovery at nappies to brake pads engineer BBA continued last year as the benefits of new chief executive Bob Quarta's efficiency drive shone through. The shares, which have more than tripled in three years, edged ahead by only 8p to 314p, however, with the market already expecting good figures.

Mr Quarta said: "1995 was a very successful year for BBA. It was also the year in which BBA shifted decisively from retrenchment to expansion. A year ago we outlined our priorities for 1995: further focus to our activities through disposals and reorganisation; greater operational efficiencies and acquisitions to entrench and expand our positions where we are already strong.

"These priorities have been achieved. Our management focus now is on growth, both organically and through acquisitions."

The signal that more purchases might be in the pipeline accompanied a 41 per cent jump in profit before exceptional items to pounds 118.5m (pounds 84.3m). Having reached its target of double-digit profit margins a year early, the formerly struggling group was able during the year to launch Switzerland's first contested public offer when it made a break up bid for Holvis, owner of the Fiberweb nappy business.

The big jump in profits was achieved despite a 14 per cent decline in sales during the year from pounds 1.38bn to pounds 1.18bn.

BBA has said it wants to grow in Latin America and the Pacific Rim and is expected to focus on electrical and transportation businesses. It is thought to have amassed a pounds 300m war chest.

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