By JOHN ARMYTAGE
British Leyland, Britain’s biggest motor group, yesterday announced that it had made only £100,000 for its shareholders in the first half of its current year. This compares with £9.5m. in the first half of the previous year. Lord Stokes, the chairman, blames industrial disputes and rising costs of wages and materials for the disappointing results.
But the group is paying the same interim dividend of 21-d. per share as in the previous vear. The board warns, however, that this “does not imply any particular level of final dividend which will be determined in the light of all the circumstances appertaining at the time ‘.
During the six months British Leyland’s sales were worth £458m. against £438m. but the number of vehicles sold was down from 474,000 to 448,000. Lord Stokes said yesterday that production of 77,000 vehicles was lost from disputes of all kinds.
“The cash flow which would have resulted from these extra sales”, he warned, “is necessary for our plant expansion intended to maintain our sales in the world motor industry and thus keep jobs and opportunities open to all”. The group’s trading profit during the period was £5.8m. compared with £21m. After lower investment income of £200,000, compared with £300,000, and a jump in the interest bill from £2m. to £4.9m., the group’s profit before tax was £1.1m., against £19.3m.
The profits for the full year in 1968- 69 were £40.4m. Profit for the remainder of the current year “is expected to improve” since Leyland sells more cars during the spring and summer. But because of increased costs, the board warns, the profit “is likely to be well below the level achieved in the second half of last year”.
Lord Stokes lists the firms — and the cars lost by British Leyland because of disputes at outside suppliers— as follows:
- George Angus (oil seals) 2,750;
- EPS ( Export Packing Services) 858;
- Howard Tenens ( transport services) 6,641;
- Pilkington Glass 1,781;
- Rubery Owen (axles) 436;
- Sankey (sub-frames) 1,192; and
- Wilmot Breeden (door locks, window winders and bumpers ) 330.
These figures do not make any allowance for the heavy extra costs caused by disruption of supplies. The glass industry and tyre disputes meant building incomplete cars which had to be finished off later at extra cost. “Glass has been flown in from Italy, Belgium and South Africa, and new tyres are being flown in from the Continent to try to maintain production,” said Lord Stokes.