Animal feeds and additives specialist Anpario's self-help initiatives in its lower margin UK business coupled with an increased emphasis on overseas growth helped the company grow underlying earnings 23 per cent despite a decline in overall revenues. And this continuing structural shift in the business bodes well for the future.
International sales made up two thirds of Anpario's turnover last year and it would have been even higher were it not for the economic upheaval in the eurozone, the Japanese earthquake and tsunami and the Arab spring uprising across the Middle East and north Africa. The drivers of overseas growth were Asia Pacific, and China in particular, and Latin America, where agricultural titan Brazil is the biggest opportunity. Anpario has traditionally worked through distributors, but is now getting more involved on the ground in its main markets. The Chinese business is now breaking even and the recent acquisition of Meriden Animal Health means the country accounts for 10 per cent of group revenues.
Selling more 'late stage' feed additives in emerging markets gives Anpario better margin than its UK business where it has traditionally relied on the Vitrition organic feed brand. But a refocus in the UK on additives is improving margins there too.
FinnCap is forecasting adjusted EPS of 10.6p for 2012 (2011 8.9p).
ANPARIO (ANP) | ||||
|---|---|---|---|---|
| ORD PRICE: | 94p | MARKET VALUE: | £ 18m | |
| TOUCH: | 90-98p | 12-MONTH HIGH: | 102p | LOW: 75.5p |
| DIVIDEND YIELD: | 2.6% | PE RATIO: | 10 | |
| NET ASSET VALUE: | 86p* | NET CASH: | £4.4m | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2007 | 5.0 | 0.5 | 0.1 | nil |
| 2008 | 5.4 | 0.5 | 3.0 | 0.05 |
| 2009 | 11.0 | 1.4 | 9.5 | 1.15 |
| 2010 | 21.6 | 1.5 | 7.0 | 2.00 |
| 2011 | 19.2 | 1.8 | 9.2 | 2.40 |
| % change | -11 | +22 | +32 | +20 |
Ex-div: 04 Jul Payment: 27 Jul * includes intangible assets of £7.2m, or 39p a share | ||||
