P&O is to sell off its property portfolio and return to its shipping roots following growth in its cruising and ferry business.
The news came as the group’s chairman Lord Sterling unveiled a 15% increase in profits to ú415m. The company is planning to sell off Earls’ Court Olympia and will float Bovis and its shipping and cargo interest, P&O Nedlloyd.
The best performer within the P&O portfolio was the cruising sector, which saw profits rise by 22% to ú216.1m. The group reported that it expects the number of people in its prime cruising age group of 50-59 to almost double from 22m in 1990 to 41m by 2010.
Ferry profits also increased by 11% from ú73.2m to ú81m, helped by the more stable cross-Channel market since the company created a joint venture with Stena Line last March.
The result has been an equalling out of supply and demand.
Lord Sterling said: “Cruise, ferries and ports will be our core divisions. These businesses offer high growth and high returns and are ones where we have a strong position in key world markets.”
Analysts have long urged P&O to concentrate its business interests in one area.