Interlink: German loss
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• Losses of up to £500,000 are expected from Interlink Express German operation, set up only two months ago, for the year ending June 1989.
This warning resulted in the company's shares tumbling 88p to 21.88 last week.
City analysts predict losses of up to £3 million in Germany in the 1989/90 financial year, and estimate the company's pre-tax profits will fall to £4.25 million — a drop of more than £1.5 million from 1987/88.
Chairman Richard Gabriel says the company had expected an income of around £500,000 from the German operation this year, but trading losses were incurred because of a lack of committment from franchisees. He says: "Many of our franchisees in Germany looked upon Interlink as just a small sideline."
Peter Sanden, the group's managing director for Germany, has left the company and been replaced by six UK managers. David Coe, managing director of Interlink Express, who was also involved in the German operation, resigned last month.
Gabriel says the losses in Germany have delayed the group's plans to expand into other European countries. "But we are not discouraged."