Boss battles crisis at FKI

FACING the worst crisis in his 10-year career at engineering group FKI, chief executive Bob Beeston is to extend his contract one year beyond his normal retirement date of next February. He hopes by then to know more about the 'likely depth or duration of the current downturn', which may lead to more job losses.

Some 1,400 have already left the group, but its worldwide workforce still totals 16,540. Beeston is making no predictions about future cuts but said: 'We will react to conditions over the next few months.'

Most of the damage has been in its North American markets where 79% of its business is done. Its European markets are 'holding up well'. Beeston is confident FKI's Logistex and Energy Technology markets will continue to grow. It has suffered most in reduced orders from airports for its material handling equipment in the wake of the terrorist attacks.

First-half turnover to end-September was £809m against £823m last time. Pre-tax profits slipped to £70.1m from £84.6m, with earnings per share at 8.77p compared with 10.36p in September last year.

The interim dividend is held at 4.2p with cover of 4.4 times. Beeston admitted that at a share price of 182 1/2p, down 2 1/2p, a yield of 6% is important for shareholders. 'We will make up our mind on the final dividend in May,' he said.