Hanson profit boast fails to inspire

SHARES in building materials group Hanson slipped in early trade, despite the group predicting full-year profits would top City forecasts. The group said its 'back to basics' initiatives would boost earnings, helped by cost-cutting and passing on price increases. Pre-tax profits before one-off items were likely to be slightly ahead of the market consensus of £328.3m.

But there was no sign of a breakthrough on the sale of the brickmaking business, on the block since June. There has been talk in the City that negotiations with management have faltered over price. Schroder Salomon Smith Barney was expected to raise £500m from the sale, but there are fears it may fetch only £400m.

Hanson would say only that it expects other disposal proceeds, such as the sale of Waste Management, to realise £235m this year. The shares fell 14 1/4p to 474 3/4p.