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Company Spotlight: Qualceram Shires

FINANCE

ONE OF a handful of Irish firms with dual listings in Dublin and London, bathroom products manufacturer Qualceram Shires, employs more than 800 people in Ireland but struggles for coverage.

The business was formed by Qualceram's £42 million acquisition four years ago of the UK-based Shires Group, which dates back to 1934.

The newly enlarged group is still based in Arklow, County Wicklow, but the acquisition gave Qualceram Shires a 10 per cent market share in the UK, with operations in Stoke-on-Trent, Darwen in Lancashire and Bradford.

One of the main reasons for the dearth of interest was the lack of a dividend.This was partly due to trading in the red and heavy borrowing, but gearing was cut to 67 per cent, a lossmaking plant in Hanley closed and group properties sold as part of plans to break into the black.

Adverse currency movements and competitive UK trading left turnover down 5 per cent at £63 million but Qualceram Shires returned a £2.3 million pre-tax profit last year.

This led to the restoration of the dividend and a final payment of 3.5p per share last year inevitably attracted more interest from investors.

The shares have gone up by half in the past few months, which makes them unattractive as a short-term speculative play but there could be opportunities in the longer term.