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Helphire sees annual profits fall by 86%

Accident management group Helphire saw its adjusted profit before tax fall more than 86% in the second half of 2008 as
costs rose and margins narrowed.

Adjusted pre-tax profit was £3 million, down from £22 million a year earlier, although sales rose by 10% to £203 million.

“While revenues were ahead of the same period last year, higher costs and lower gross margins have led to a significant deter-ioration in profitability, demanding an urgent response from management,” the company said in a statement to investors.

Helphire was hit in 2008 as higher fuel prices and the downturn led to reduced car usage.

It said it has already drawn up plans to cut up to 130 jobs.
Helphire has also scrapped its interim dividend.

“In the absence of the expected growth, the group is now implementing a programme to realign its cost base to anticipated business volumes,” the company said, adding that it was confident it was now in a position to improve the group’s performance.

Helphire shares have lost more than 90% of their value in the last year, but remained flat at 29p immediately following the announcement.

The results were followed by a further announcement that it had appointed three new non-executive directors, including Michael Howard, former Home Secretary during John Major’s Government.

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