Chief executive Charles Wilson puts this success down to a very clear focus on improving the quality of its ranges and service. And with conversion of 142 its 172 stores to a large 'Extra' format complete, Booker has been better able to showcase its improved offering, driving strong growth of own label ranges such caterers brand Chef's Larder and value brand Euroshopper, which grew sales by a third.
As well as upgrading its stores, Booker continues to grow its delivered business. Internet sales climbed 21 per cent to £635m, and the group has also now opened its new Chef Direct distribution centre which will enable it to target large pub and restaurant chains, a segment of the market which Mr Wilson admits that the group is not currently doing enough business with.
Broker Investec expects pre-tax profits of £92m and EPS of 4.7p in the year to March 2013 (from £83.5m and 4.4p last year).
|BOOKER GROUP (BOK)|
|ORD PRICE:||77p||MARKET VALUE:||£1.21bn|
|TOUCH:||76-77p||12-MONTH HIGH:||86p||LOW: 63p|
|DIVIDEND YIELD:||3.0%||PE RATIO:||16|
|NET ASSET VALUE:||24p*||NET CASH:||£63.4m|
A forecast PE ratio of 16 may look expensive, but it's a fair reflection of the quality of Booker's operation, and the growth potential in catering. Buy.
Last IC view: Good value, 76p, 17 October 2011