Graseby Plc, the medical, product monitoring, environmental and technology group blamed a 5% reduction in group turnover to ú5.4m on a ú3.7m drop in Environmental sales. Profits for the half year were up 2.3% at ú5.4m. The Cambridge-based electronic instruments group remained gloomy about the future of the sector and said that it could not forsee any significant improvement in market conditions for the US environmental business. It plans to cut costs and promote higher margin activities in an effort gradually to restore profits to this area. Profits for the sector as a whole dropped 133.3% to ú600,000 on sales that were 25% lower at ú10.8m, although the European environmental business remained steady, the company said. Falling Environmental revenues were due to a tailing off in orders for the company’s continuous emission monitoring systems from the US Environmental Protection Agency and costs incurred in moving Graseby Nutech and Graseby Andersen, its Atlanta-based US subsidiary onto one site, the company said. The technology business also saw sliding sales and profits. Profits dropped 48.9% at ú700,000 on sales down 12% at ú11.0m and was due to a reduction in defence-related activity. Graseby is currently seeking compensation from the UK Ministry of Defence for cancellation a classified programme for for which the group said it had a long-term commitment. But the group is confident that its ion mobility spectrometry technology will boast this sector. A stronger peformance from the medical and product monitoring sectors, which together accounted for just over half of the group sales, offset the weakness of the other two businesses. The medical business saw profits up ú900,000 to ú2.7m on turnover up 20% at ú10.2m. Product monitoring sector profits rose 22% to ú2.4m on sales up 11% at ú13.2m. The UK medical business grew 24% as a result of heavy orders from the National Health Service especially from January to March, overseas sales for this sector were also up 16% in areas where direct sales operations have been set up. Product monitoring profits included first time contributions of ú300,000 from Anritsu Corp, its Japanese distributor for the company’s CDX quality management system. The group says it expects prospects for its Medical and Product Monitoring businesses to continue to be encouraging although it said that the Medical business is unlikely to repeat the profit performance of the first half in the current half of the year. The announcement of first half figures bumped Graseby’s shares up tuppence to 147 pence. The board will recommend a final dividend of 2.7p making a total for the year of 6.6 pence, the same as 1994.
