On a calendar year basis Christmas accounts for around half Character’s retail sales. So, not surprisingly, the toys and games maker is being cautious about the current trading period. However, a combination of a record dividend payout and £5.1m of share buy-backs in the year to August (average cost 168p a share), and a further £1.6m since the financial year-end (average of 173p), suggests the board has plenty of confidence about the future.
Last year 60 per cent of revenues came from own-developed (and so better controlled) branded products such as Peppa Pig and Doctor Who - although the best seller was still those furry and noisy Zhu Zhu hamsters. And for the current financial year, the company has a decent pipeline of new product launches including Mike the Knight with the catchy motto “Be a knight, do it right” and applications for junior smart phones.
Given the pressures on consumer spending, Character is rightly cautious about prospects and management forecasts a similar level of profits in the current year although profits will be helped by net cost savings of up to £1m over time from purchasing the freehold of its offices in New Malden (leased since 1998) and the freehold of its warehouse in Oldham which has plenty of expansion possibilities. Together Character paid £4.7m in cash for them.
CHARACTER (CCT) | ||||
|---|---|---|---|---|
| ORD PRICE: | 150p | MARKET VALUE: | £34.4m | |
| TOUCH: | 148-152p | 12-MONTH HIGH: | 216p | LOW: 138.5p |
| DIVIDEND YIELD: | 4.0% | PE RATIO: | 5 | |
| NET ASSET VALUE: | 33p | NET CASH: | 64% | |
| Year to 31 Aug | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2007 | 95.1 | 12.58 | 19.2 | 4.4 |
| 2008 | 82.3 | 5.14 | 12.0 | 2.2 |
| 2009 | 68.6 | -2.17 | -4.1 | 1.0 |
| 2010 | 85.2 | 7.55 | 20.1 | 4.0 |
| 2011 | 95.0 | 9.05 | 28.5 | 6.0 |
| % change | +11 | +20 | +42 | +50 |
Ex-div:04 Jan Payment:27 Jan | ||||
