Aga can see hope for the autumn sales but retail confidence cooling

Aga Rangemaster returned to profit in the six months to June 30 but said it did not expect to see a substantial rebound going forward as consumers were still extremely cautious about committing to larger value purchases.

Having survived the recession, Aga followed up a profitable second half to 2009 with operating profits of 800,000 in the first half of 2010.

Revenues increased by 5 per cent to 123.4m after an improvement in Aga sales volumes as existing owners upgraded their models and burner systems.

The all-in-one cooker-boiler brands, Rayburn and Stanley, were down as enthusiasm for solid fuel and wood burning models fell away. Overall, sales volumes for cast iron cookers were down 10 per cent from 6,500 to 5,850.

Aga said: "We are moving into the key autumn selling season and the current level of leads across our brands does suggest a reasonable sales period ahead although the consumer mood is currently more subdued than in the spring."

The UK generated 62 per cent of sales in the half-year, with 23 per cent coming from Europe and 15 per cent in North America and the rest of the world.

The Leamington Spa-based company said its Rangemaster cooker division posted a further strong performance with revenues up by around 10 per cent.

While cooker volumes in the UK were flat, average selling prices rose due to a shift to higher specification products and a broadening of model ranges.

Yesterday's operating profits of 800,000 were broadly in line with City expectations and well ahead of the pre-tax loss of 1.1m seen last year.

A one-off pension credit lifted bottom-line profits to 16.4m.

Under a recovery plan agreed with the trustee of the pension scheme, the group will make contributions of 2m in 2010 and 2011, followed by 10m a year between 2012 and 2020 and a one-off 48m at the end of 2020.

The actuarial deficit was 84m at the end of last year.

Andrew Wade, an analyst at Numis Securities, said: "Although the business continues to make operational progress, investors must clearly pay close attention to the pension position."

Shares were 4 per cent higher yesterday after Aga restored its dividend at 0.7p a share.