Record cotton prices boost profits at Plexus
RAPIDLY-escalating cotton prices proved to be a boon for Liverpool-based brokers Plexus Cotton in 2010 as sales increased by 50% to $400m (£250m). Pre-tax profits at the firm also shot up to £8.1m, from just £180,000 in 2009.
The company, which recently moved its headquarters to 20 Chapel St, said that it “took advantange of the strength in the global cotton market to deliver an extermely succesful year, with significant growth in profitability which has led to a stronger balance sheet”.
Inded, the bulk of the profits have been retained within the business and its net assets mmore than doubled to £7.6m, from £3.5m a year earlier.
Notes accompanying the accounts prepared by Plexus Cotton’s directors state that they “are confident of carrying this performance forward into 2011.”
The company, which is majority owned by chairman Nick Earlham, also has investments in a number of subsidiaries in Mauritius, Hong Kong, Malawi, Uganda and South Africa.
Directors hailed the performance of its cotton farming operations in Mozambique, in which the firm owns a 75% stake. The division converted a $3.75m loss in 2009 into a profit of almost $1.8m last year. However, accounts also state that due to the “sustained political and economic instability in Zimbabwe” the firm did not believe it was in control of its subsidiaries and joint ventures in that country.
Two Zimbabwean businesses, Pipstrelle Enterprises (Pvt) and Myope Investments (Pvt), did not trade during the year. The results from a joint venture in which it had a 50% share, Romsdal Investments, were not consolidated into the group’s figures. It made a profit of $1.9m and held assets of more than $4.3m.
