The results from glassmaker Ardagh were reasonably good with the pretax profit figure up more than 11 per cent in the year to June. But Ardagh is facing into some tough times over the next year, with Sean Quinn's low-cost glass plant in Fermanagh expected to result in a cut in operating margins, while declining interest rates will make it imperative that Ardagh does something with its £19 million cash pile.

To put the Quinn plant in context - it will have a capacity of 170,000 tonnes a year, roughly similar to the capacity of the Ardagh plant in Dublin when the current investment programme at Ringsend is completed. The size of the Irish market is not much more than 140,000 tonnes a year. That means that 340,000 tonnes of glassmaking capacity will be looking to service a market of 140,000 tonnes. Those figures indicate clearly the need for Quinn and Adragh to sell into the British market and the low-cost Fermanagh glassmaker, with no exchange rate risks to worry about, has the advantage.

For years, Ardagh has been talking about acquisitions without actually doing anything, but it is reasonable to assume that new chairman Paul Coulson, a man with a reputation as an aggressive dealmaker, has not bought 8.7 per cent of Ardagh based on the glassmaker's past performance.

Will Coulson orchestrate a bid for the Rockware glass plants in Britain that have to be sold and is Ardagh - currently valued at £42 million - capable of funding the £200 million bid that the Rockware plants would cost. It's hard to see the market being too thrilled about a massive cash call for a bid of this scale.

Elsewhere, it's hard to see where Ardagh can spend money on acquisitions, so the prospect of a share buyback - or special dividend - is a good possibility.

Ardagh shares have fallen from a 215p high this year to the current 125p and can hardly go much lower, so there's little point in selling out, especially if a buyback or special dividend puts some cash into shareholders' pockets. Hold!