FW Thorpe raises dividend despite flat year

23rd Sep 2010 14:24

Lighting equipment supplier FW Thorpe has increased its dividend even though its profit fell slightly in the year to June 2010. Revenues grew 4% to £55.6m but pre-tax profit fell 2% to £11.3m. The total dividend has risen 3% to 16.7p a share, which is still covered more than four times by earnings. The business is highly cash generative and AIM-quoted FW Thorpe has £8.75m in the bank so it can easily afford the dividend. The interest contribution from the cash pile was much lower than the previous year and the operating profit improved from £10.7m to £11.2m. Many of the operations produced flat figures last year but the core Thorlux Lighting business increased revenues and profit. Management admits that this may have been because of borrowing by the government. Management is hopeful that lower government spending on new school buildings should mean more refurbishment spending. Sectors such as tunnel and prison lighting should hold up better than other areas. FW Thorpe is already offering LED products and is developing more.