Solid exports and increased demand from telecommunications customers helped boost the half-year performance for industrial computer specialist Concurrent Technologies.
Moreover, orders from defence customers remained surprisingly robust and the group's total order book grew 7 per cent in the period. Managing director Glen Fawcett reckons that budget austerity has yet to make much difference to defence customers, pointing out that "the delays we've seen have mostly been technical, rather than budgetary". Exports were the biggest single factor in these results and now comprise 78 per cent of total sales, mainly to Germany, France and the US.
At present, Concurrent is focused mostly on internal development rather than acquisitions. So research and development spending is forecast to hit £2.6m this year, and the company also plans to increase headcount at its development facility in Bangalore and increase capital spending. The company has already spent money on new milling equipment to boost its mechanical and thermal engineering capability. That comparatively small investment, of £50,000, will shave weeks off the time it takes for new products to be developed.
Broker Cenkos forecasts pre-tax profits for 2011 of £2.9m, giving EPS of 3.6p (£2.3m and 2.8p in 2010).
CONCURRENT TECHNOLOGIES (CNC) | ||||
|---|---|---|---|---|
| ORD PRICE: | 44p | MARKET VALUE: | £31.4m | |
| TOUCH: | 42-46p | 12-MONTH HIGH: | 51p | LOW: 31.5p |
| DIVIDEND YIELD: | 3.5% | PE RATIO: | 14 | |
| NET ASSET VALUE: | 17p* | NET CASH: | £5.4m | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2010 | 5.41 | 1.00 | 1.08 | 0.55 |
| 2011 | 6.87 | 1.13 | 1.45 | 0.60 |
| % change | +27 | +13 | +34 | +9 |
Ex-div: 7 Sep Payment: 23 Sep *Includes intangible assets of £4.82m, or 6p a share | ||||
