In 2011 specialist plastics supplier Filtrona demonstrated the focus it has put on top-line growth. To this end, Filtrona made a brace of significant second-half acquisitions in the form of Reid Supply and Richco Inc, which will increase Filtrona’s exposure to high-growth economies.
The impact of these acquisitions will become clearer in the first half of 2012, but it’s worth noting that even after excluding their contributions, together with the effects of currency movements, Filtrona's underlying like-for-like revenue increased by 8 per cent.
Sales expanded in each of Filtrona’s divisions while gross margins rose by 80 basis points 35.7 per cent, thanks to the group's success at passing on cost increases to customers, increased sales of higher margin products and operational improvements. The trading performance fed through to a 24 per cent rise in operating cash-flows to £92.7m, which supported the hike in the full-year dividend.
After spending £89m on the Reid and Richco acquisitions, net debt finished the year up nearly 60 per cent at £145m. Nevertheless, Filtrona remains on the lookout for strategic targets and announced the £6m acquisition of Security World along with its full-year results.
Subject to revision following these results JPMorgan Cazenove estimated adjusted 2012 EPS of 27.16p (2011: 24.29p)
| FILTRONA (FLTR) | ||||
|---|---|---|---|---|
| ORD PRICE: | 408p | MARKET VALUE: | £851m | |
| TOUCH: | 407-409p | 12-MONTH HIGH: | 411p | LOW: 285p |
| DIVIDEND YIELD: | 3% | PE RATIO: | 19 | |
| NET ASSET VALUE: | 99p* | NET DEBT: | 68% | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2007 | 494 | 51.7 | 15.3 | 7.60 |
| 2008 | 432 | 46.7 | 17.1 | 7.78 |
| 2009 | 444 | 32.3 | 5.8 | 7.78 |
| 2010 | 490 | 61.6 | 23.3 | 9.00 |
| 2011 | 541 | 64.3 | 20.9 | 10.50 |
| % change | +10 | +4 | -10 | +17 |
Ex-div: 11 Apr Payment: 30 Apr *Includes intangible assets of £186m, or 89p a share | ||||
