Shares hit as Holmes falls two-thirds

FIRST-QUARTER profits have tumbled 66 per cent at Holmes Protection, the US-based and London-listed company headed by Sir Ian MacGregor, former chairman of British Steel and British Coal, writes John Shepherd.

Shares in the provider of security services fell 3p after the results were announced, to a year's low of 51p.

Holmes said several factors were behind the drop from dollars 1.02m to dollars 345,000 (pounds 223,000) before tax, including redundancy payments, the upgrading of a computer system, and costs associated with redressing a dollars 2m unfunded pension liability.

There was a net cash outflow before financing of dollars 1.64m during the quarter.

The acquisition of subscriber monitoring contracts had fallen behind the projected timetable, culminating in an increase in borrowings.

Sales in the first quarter dipped from dollars 14.5m to dollars 13.7m. Earnings per share were halved at 0.7 cents.