Samuel Heath, the Birmingham maker of bathroom and other architectural fittings, coupled a healthy set of full-year results and a 74 per cent dividend increase with a warning of the implications of today's metal prices.
Sam Heath, chairman, attributed what he described as an "extremely satisfactory" outcome for the year to March
to productivity and went out of his way to praise Heath's employees for "a quite outstanding performance".
But looking ahead, Mr Heath highlighted the "quite spectacular" increase in the price of copper and to a lesser extent zinc.
"I always seem to be cautious," he said, "but these factors make me more so when talking about prospects for the next trading periods.
"It is our lifeblood, our basic raw materials. There is no ducking or weaving. We have got to see if the market place will accept the surcharges we have to put on."
Allowing for a £680,000 transfer to two closed pension funds the year before, Heath's profits were 29 per cent higher at £1.438 million, although sales were up less than three per cent at £11.7 million.
"They were down in real terms," Mr Heath said.
Interest on £2.7 million of cash in the bank accounted for £93 million of the improvement and a tax charge £102, 000 less than in 2004/5 boosted the bottom line.
So a final dividend of 12.5p making 23.5p for the year -against 13.5p last time - is still covered 1.77 times by the year's earnings.
"We felt we were able to do it after being fairly cautious in the past without, hopefully, over-stretching our balance sheet," Mr Heath commented.
In the meantime the pension deficit is down to £806,000 from £1.59 million.
Unchanged yesterday at 490p, or 8.5 times the year's earnings, the AIM-listed shares now yield 4.8 per cent.
An up-graded "Perko Powermatic" door closer and several bathroom innovations were among successful new products last year.
At home, though, Heath has come under some pressure from imports.
"To counter-act this, we are of course offering our own limited range of imported items," Mr Heath added.