Improved margins lead to stronger profits for Creightons

Toiletries group Creightons reported a 21% jump in pre-tax profits in the six months leading to 30 September on the back of improved margins and increased revenues.

Profit before tax in Creighton's first half of trading grew from the £790,000 it posted a year earlier to £956,000, as operating margins moved from 5.1% to 5.8% and revenue gained 7% to £16.7m thanks to a 13.5% bump in order intake.

The group's gross margin was 42.1% in the half, primarily driven by benefits from supplier base consolidation.

Earnings per share came in at 1.09p, a slight increase on the 1.0p posted at the midway point of the 2016 financial year.

Net cash on hand, cash and equivalents less short-term borrowings and loans, came to a borrowing figure of £246,000, a significant change from the £43,000 of borrowings held a year earlier, mainly due to higher working capital requirements to support sales growth throughout the period.

Executive chairman W McIlroy said, "The board and I believe that this half year's sales of £16,734,000 and profit after tax of £724,000 continues to place the group in a good position to take advantage of any opportunities that may arise."

After having paid a final dividend of 0.23p per ordinary share in August, Creightons announced it would be paying an interim dividend of 0.15p in December.

As of 1120 GMT, shares had dropped back 8.86% to 36.00p.