Stockbuilding ahead of Christmas has helped power cord and interconnect cable maker Volex deliver decent half-year figures. Chief executive Ray Walsh says that he remains confident, despite the current market turmoil, and has therefore reinstated the group's half-year dividend pay-out.
This stockbuilding activity has boosted the core consumer business in particular, which generates 63 per cent of group sales – revenues here soared 12 per cent in the period to $169.9m (£106.2m). Plans are now in place to extend relationships with existing premium customers, too, including Apple, HP and Sony, in order to cross-sell other cable and power-related products.
Meanwhile, continued manufacturing automation has propelled growth in the industrial unit and divisional revenues grew 27 per cent to $20.3m. There has also been impressive growth in the healthcare division, where sales rose 30 per cent to $24.3m. Weak conditions in India, however, hampered growth in the telecoms business, where sales inched up just 7 per cent to $56.2m. Spending on telecoms hit a hiatus in India following the 3G auction last summer although, strip out India, and sales from the unit grew 13 per cent.
Charles Stanley expects full-year pre-tax profits of $26.9m, giving EPS of 23.66p ($22.9m and 20.87p for 2011).
VOLEX (VLX) | ||||
|---|---|---|---|---|
| ORD PRICE: | 270p | MARKET VALUE: | £168.7m | |
| TOUCH: | 265-273p | 12-MONTH HIGH: | 384p | LOW: 230p |
| DIVIDEND YIELD: | 1.1% | PE RATIO: | 15 | |
| NET ASSET VALUE: | 60¢ | NET DEBT: | 32% | |
| 26 weeks to 2 Oct | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2010 | 238 | 10.6 | 14.7 | nil |
| 2011 | 271 | 10.4 | 15.0 | 1.50 |
| % change | +14 | -2 | +2 | – |
Ex-div: 4 Jan Payment: 17 Feb £1=$1.60 | ||||
