Murray scores £18m profit after strong run

Published on Friday 10 September 2004 12:02

RANGERS owner David Murray has seen his Edinburgh-based holding company, Murray International Holdings, turn last year’s £2.4 million loss into an £18m profit.

In his chairman’s statement, Mr Murray described the group’s performance as "excellent", with "very positive" contributions from the metals, property and private equity businesses.

However, the latest accounts - covering the 12 months to the end of January - also revealed that net debt had risen to just over 230m from 190.2m at the start of the financial year.

The local entrepreneur insisted that the 21 per cent increase would not affect the conglomerate’s ability to underwrite a 57m Rangers rights issue, which was announced last week.

During the period under review, MIH was boosted by gains totalling some 20m from asset disposals, including the 16m sale of five-a-side football business Vida Sports. In addition, the group recently made two strategic acquisitions - taking a 30 per cent holding in Alexander Dennis and buying the contact centre arm of telecoms outfit Thus.

Pre-exceptional operating profit, after gains on sale of fixed assets and investments, rose for the fifth consecutive year, from 20.2m to 21.4m. Meanwhile, net assets increased from 89m to more than 100m. Mr Murray said: "We have been very active in all aspects of our business during the financial year.

"While I am once again pleased to announce another year of improvement in the group’s operating profit, I am particularly encouraged by a 20.4m increase in the profit before tax."

He added: "The reported turnover figure of 249m does not reflect certain property disposals that took place during the year and which made a healthy contribution to the group’s overall result."

Seven months into the new financial year, Mr Murray said profits were ahead of last year.

MIH has been expanding at a rapid pace, and is aiming to be a 1 billion business in three years’ time. Last month, Mr Murray strengthened his metals operation with the multi-million pound acquisition of west coast firm Ireland Alloys. Capital-based Murray Metals Group said it would gain 40 staff and a company with an "excellent reputation worldwide" as part of the deal.

Ireland Alloys - based in Hamilton - sources and recycles complex alloys and other valuable metals for use in oil and gas production equipment, jet engines and turbines.

Rangers accounts for about a tenth of the Murray empire, outside his core interests of property, private equity, metals and mining.

The businessman has an 86.3 per cent stake in the Ibrox club after buying out Enic Group’s 20.2 per cent holding a fortnight ago.

At the start of this month, Mr Murray announced his decision to return as executive chairman of the Ibrox side.

MIH has committed to underwriting 50m of the forthcoming Rangers rights issue, and Mr Murray stressed that the bulk of his holding company’s borrowings are secured against property, which generates income to cover interest payments on debt.

He added: "It is categorically not a problem for MIH to do this [underwrite the rights issue]."

Rangers will be brought within MIH following the rights issue, but remain listed on the Ofex stock market.