Heiton Group warned today it expects earnings for the year to April 30th, 2002, to fall short of current market expectations and the prior year.
The warning follows the continued slowdown in the building industry in Ireland, it said. The group is planning a rationalisation of its Irish operations and said it is to review its British businesses.
Volumes in the group's Irish businesses are ahead of last year, but the rate of growth has been declining throughout the period, Heiton said.
Accelerating costs in the Irish economy, notably in payroll and insurance, and a requirement for increased provisioning for bad debts, are impacting margins at a difficult time, it said.
The group's British business is performing ahead of last year due to the strong contribution from the recently acquired Willis Builders Merchants. But the performance of UK subsidiary Cooper Clarke continues to disappoint, Heiton said.
The Irish cost-cutting programme is expected to produce savings in a full year of some euro 2.8 million, and to have a one-off implementation charge of circa around euro 4 million, said the group.
It said benefits will start to accrue in the final quarter of the current financial year and the full impact will be reflected in the results for the year starting May 1st, 2002.
AFP