France Blamed As Photo-Me Slips To 11.3m

Peter Berridge, group managing director for finance and administration, said he was not happy'' with the results. A seven-week transport strike in France had significantly impacted on sales'', with performance there suffering further from a two per cent increase in TVA, the French value added tax.

Profit in continental Europe fell to 2.9 million (4.9 million). Berridge said margins had tightened but the group had turned round operations in Germany so they now show a small profit. In the UK and Republic of Ireland, profit was down to 1.9 million (5 million), with a non-recurring charge of 1.6 million on the disposal of the lossmaking plastic card division.

 

Net debt was 43 million (31 million), giving gearing of 40 per cent.

Peter Ogborne, group managing director for operations, said Photo-Me would be entering new markets without increasing fixed costs, particularly through the use of older equipment which would otherwise have to be warehoused''.

The group had invested 8 million on R&D and was developing mini-labs for the new APS film format which would be launched in two weeks.

More emphasis would be placed on growing support products, such as card printing vending machines and children's rides.

Nick Batram, analyst at Greig Middleton, said the results were fairly disappointing''.

He reduced pre-tax profits forecast for next year to 11.3m. The final dividend is held at 3.5p, giving an unchanged total of 5p. Earnings per share fell 27 per cent to 8.48p. The shares closed at 133p, down 25p.