That should add another string to its own-label portfolio which already covers 59 per cent of its crisp sales

That should add another string to its own-label portfolio, which already covers 59 per cent of its crisp sales.House brokers Peel Hunt reckon profits will rise to pounds 2.4m this year, putting the shares on a forward multiple of 10 Reasonable value.. Its Dandy and Beano crisps, joined last year by Spiderman extruded snacks, have continued to do well and it is cranking up a new line at Kirkham to take control of all its tortilla corn chip production. There should be more of that after gearing tumbled from 64 to 16 per cent during the year.The key question for Bensons, with just 6.5 per cent of the crisps market, is whether it can avoid the pitfalls of the past. The comparison was helped by a pounds 933,000 provision for a loss on a business sold, while interest charges fell. Pre-tax profits leapt to a record pounds 2.03m in the year to November, up from losses of pounds 747,000, producing earnings per share of 4p. Yesterday’s return to the black after two years of losses only served to underline the transformation. But after a pounds 4.6m rescue cash call at 16p a share two years ago, new management has wrestled the group on to an even keel.

Such novelties did not prevent the group coming to the brink of collapse in 1994 after being hammered in a supermarket price war. The tiny Lancashire- based company has won fame beyond its size for such classics as hedgehog- flavoured and jacket crisps, many of which have been copied by its deeper- pocketed bretheren. Sadly, Bensons Crisps’ record as an innovator in the snack market has not been matched by its financial performance. Yielding 6.2 per cent, they are well supported, but investors hoping for a bid may be disappointed Unattractive..

NatWest has raised its profits forecast to pounds 94m for this year, putting the shares on a modest forward p/e of 10. Willis enjoyed a 4 per cent rise in reinsurance brokerage last year, a 2 per cent increase in speciality businesses like marine and aerospace and growth of 6 per cent in so-called “retail” lines sold to companies in the UK and 3 per cent in North American retail.With no debt, the group is well positioned to attack the maturity of its markets by buying some of its smaller competitors, but it still has a big hill to climb.Even with 70 per cent of this year’s revenues sold forward, the currency impact of the pound at current rates could be pounds 6m to pounds 7m Meanwhile, rates continue to fall. In view of that, Willis did well to raise brokerage and fee revenues in the continuing business by 3 per cent to pounds 683m.The picture is even better in most individual business sectors. The figures included a further pounds 11.3m severance burden as employee numbers, 11,500 two years ago, fell another 11 per cent to 9,116.They are probably the minimum required in a business operating in a market which saw premium rates fall another 10 per cent or so last year. The pounds 14.5m profit commission for the 1993 year of account, a bumper one for names, is the first for several years and Willis is warning that current estimates are that 1994 commissions will be around half the previous year’s level.
Looking past these swings and roundabouts, the group is doing its best to manage its way through the storms which continue to swirl around the broking industry.

Equally, the rise in operating profits from continuing businesses from pounds 79.4m to pounds 87.8m was helped by what is likely to prove a one-off boost from Willis’s Lloyd’s members’ agency. The comparison was flattered by last year’s net exceptional hit of pounds 30m, mainly for extra provisions to cover the group’s withdrawal from certain UK underwriting operations. At first sight, the market’s reaction looked churlish, given that pre- tax profits, up from pounds 50.2m to pounds 91.6m in the 12 months to December, came in ahead of expectations. Over the past five years alone they have lost 45 per cent of their value, dropping another 6.5p to 133p yesterday as currency woes were piled on top of the continuing gloom about insurance rates. The shares have been in steady retreat since peaking at 492p in 1986. Insurance brokers such as Willis Corroon have had little going for them over the past five years as rates have been driven relentlessly lower.

To benefit fully from that it must beef up its spending on exploration and production capex, continue to explore partnerships such as the Texaco and Amoco alliances in North America and reduce the company’s exposure to the other damaging downstream cycles.Shell will never set the investment pulse racing, but as a steady, core holding in an extremely well-run, reliable company, it is unbeatable.. In the brave new world of supermarkets selling petrol and oil companies peddling forecourt groceries, it will require nimbler feet than Shell has shown in the past to come out on top.Shell’s $12.3bn cash pile puts the company in an enviable position ahead of what the company forecasts to be a sustained rise in oil and gas production of perhaps 7 per cent a year for the next five years. In chemicals, that is the case in spades, and the challenge is relentlessly to cut costs and to churn the portfolio away from the basket case products where oversupply and weak demand mean there is no hope of ever getting a sensible margin.Marketing, the lion’s share of the downstream operation, is the real problem area, with deregulation in previously protected markets such as Japan causing havoc as old retail boundaries break down. Refining margins have been under pressure around the world for so long that inadequate returns are becoming the norm. Shell has an unmatched spread of exploration prospects world-wide and is cutting the cost of extracting oil along with the best in the industry.It is elsewhere in the business, however, that Shell’s future performance will be decided. In a year when the oil price rose steadily to well above its average trading range over the past 15 years, buoyant returns from exploration and production (up 74 per cent to pounds 3.2bn) were more than enough to offset a slump in chemicals profits (down 30 per cent to pounds 762m) and an indifferent refining and marketing performance (2 per cent better at pounds 1.75bn before exceptionals).The upstream arm benefited from the price of Brent crude rising to its highest levels since the Gulf war spike in 1990/91.