Vodafone slips
Cashmere firm woes after Dawson’s pension burden
CashmErE weaver Dawson International warned it could be forced into administration after its plan to offload its burgeoning pension deficit came apart at the seams.
The scotland-based company, with a rich history stretching back to the 1870s, sells the luxury material to brands including Chanel, hermès and Dior.
It was once an international giant owning the labels pringle and Ballantine, and employed thousands of staff across the world.
But now the company, which was founded by Bradford mill owner Joseph Dawson after being inspired by a visit to the Indian province of Kashmir, is a shadow of its former self.
It now has fewer than 200 workers across its outlets in scotland, mainland Europe, China and the usa.
It has struggled to deal with a £90m black hole in its company pensions plan, caused by a backlog of almost 3,000 people signed up to the scheme.
The company tried to run into the arms of the government pension protection Fund (ppF), which offers to take on the liabilities of struggling plans. But after it was turned away, the company must now resume talks with the trustees of its scheme as well as the pensions regulator.
If it cannot reach an agreement, the company yesterday warned: ‘The board would have no alternative but to consider appointing administrators for all or part of the group.’
shares fell by 45pc on the news, dropping below the penny mark for the first time to finish 0.52p lower at 0.62p.
Chairman David Bolton said: ‘We’re caught in the most invidious of positions, where we have something outside our control that we’re responsible for.’
The company said the terms it gave to the regulator and ppF were ‘the best possible offer’.
The board believes that ppF and the regulator are both overstating the extent of the liabilities, and also being too mean when estimating the scale of the assets. Both, the group argues, are subject to large fluctuations.
In the 15 months to april, the company made revenues of £38m but a pre-tax loss of £3.5m after it sold two businesses – a yarn- spinning arm and its home furnishings division.
During the year it pumped £2.2m into the scheme in an effort to prop it up.
The company also announced that Jan holmstrom, director of the Leeds Group which owns 28pc of Dawson’s shares, will step down from the board. EuropE’s basket case economies weighed heavily on Vodafone, as Britain’s biggest telecoms company reported falling revenues.
European income from calls, texts and mobile internet limped down 1.6pc to £6.9bn, with spain proving the laggard among the major economies, down 10pc.
Italy, Vodafone’s second-largest market, suffered a 7.7pc decline, while Europe’s economic powerhouse Germany enjoyed growth of 4.2pc.
The uK delivered a lukewarm result, with sales falling 0.8pc to £1.2bn, while India provide the highlight with sales up 16.2pc.
Vodafone (down 3p to 180.05p) said that it expects to complete its £1bn acquisition of Cable & Wireless Worldwide by Friday, in a deal that will double the size of its uK corporate business. DOOM-mongers look away now. Despite the return to recession, with the first double-dip since 1975, more people are now in work than when the Coalition came to power.
Employment rose by 181,000 in the three months to the end of May to stand at 29,354,000.
That is 218,000 lower than the peak four years ago but 385,000 higher than at the time of the General Election two years ago.