Johnson’s fat margins, 24 per cent in the half year, are vulnerable to price attack and Granada’s Spring Grove Services is thought to be leading the charge.Elsewhere, the 51 per cent hoist in US dry-cleaning profits substantially reflects savings from last year’s head office move. Stripping out last year’s acquisition of Stalbridge Linen Services, stated profit growth of 6.7 per cent would have been cut to 1 per cent. The near 11 per cent rise in like-for-like sales is the best performance the industry has seen since the beginning of the decade.More worrying is the continuing competition in UK textile rental, which has formed the backbone of the group in recent years and chipped in operating profits of pounds 5.66m in the latest period. That will come in on top of savings flowing through from last year’s cost-cutting moves, worth around pounds 500,000 in a full year.But the even more encouraging factor in the rise in UK dry-cleaning profits from pounds 2.35m to pounds 2.54m in the half year was signs of improved trading conditions. The company says it is on target to have the rest of the chain of over 600 completed by the end of 1998.

The rebranding, along with other initiatives such as a discount scheme, are said to be generating 10 per cent sales increases in the refurbished shops.Given the operational gearing, around half of that growth should drop through to the bottom line, rising to perhaps three-quarters once the refurbishment costs end. Pre-tax profits of pounds 9.25m were 29 per cent ahead, for an underlying rise of 16 per cent when the effects of interest, property sales and last year’s pounds 863,000 reorganisation costs are stripped out.
The programme to unify the various dry-cleaning brand names under the Johnson banner has seen 100 shops spruced up and converted so far. The early fruits of the three-year turnaround plan unveiled at the end of 1994 by Mr Greer, who is to step down next year, are reflected in yesterday’s figures for the half year to 29 June. Dry cleaning has been a dull market, despite Sketchley’s attempts to inject a little zanyness into the business by combining cleaning with photographic processing. That said, Terry Greer, longstanding chairman of Johnson Group Cleaners, has been doing his best to shake things up at Britain’s biggest dry cleaning group. At Liverpool’s biggest Ford dealership, J Blake Group, sales are up 7 per cent so far this August, with little sign of things slackening off.Mark Haymer, its sales director, said customers were choosing bigger cars than last year, and showing less interest in more economical diesel models.”We’ve actually run out stock of popular lines such as Escort special editions, whereas last year we were selling more small cars like Fiestas,” he said “We’ve also seen lots of interest in sportier versions. People seem to be saying ‘We’ve been careful, now let’s have a bit of fun.’”The final total depends crucially on whether the biggest manufacturers offer extra incentives to dealers and customers to inflate demand in the last few days of the month.One source suggested several of the biggest manufacturers, including Ford, were preparing to boost their figures by selling large numbers of cars to dealers, a tactic known in the trade as “pre-registering”.The move can transform August sales in the last day of the month.

A Ford spokesman refused to be drawn last night: “We don’t comment on the figures and we don’t speculate about the state of the market,” he said.. ITV companies are balking at the high cost of introducing digital terrestrial television (DTT) in the UK, and may lobby the Government to make radical changes to the planned service. According to confidential figures prepared by the ITV companies, DTT – planned for early 1998 – will cost them a net pounds 40m in the first year, even counting the advertising revenues the service could generate.
The costs would be highest for the big ITV licence holders, with Carlton expected to cough up pounds 12m, Granada about pounds 10m and United News & Media, which controls the Anglia and Meridian franchises, about pounds 7.5m. Even the smaller companies, such as HTV, could be required to spend more than pounds 2m in the first year.Just broadcasting the existing schedule, a requirement of the DTT licence, would cost the ITV companies pounds 10m a year, the figures show. The rest of the budget would be spent on a basic package of extended services, such as repeats of favourite programmes. “That’s a lot of money just to have time-shifting,” laments one ITV executive.The Department of National Heritage, headed by Virginia Bottomley, had been hoping commercial broadcasters would confirm their intention to take up their allotted space on the planned DTT service by September.