Filtrona's share price rose by over 4 per cent to close in on an all-time high in response to half-year results that beat analysts' estimates and revealed a substantial hike in the half-year payout. The market value of Filtrona - up by a quarter this year - reflects solid support for the specialist plastics supplier and with some justification.
On an underlying basis, both pre-tax profits and adjusted EPS rose 24 per cent to £49.1m and 16.3p, respectively, and Filtrona chief executive Colin Day believes that the business is "well positioned" to achieve its 2015 revenue and earnings target of "at least mid-single digit like-for-like revenue growth and double-digit EPS growth at constant exchange rates".
Comparable half-year revenues rose by 9 per cent on a like-for-like basis, principally due a strong sales uplift from the protection and finishing products division, which accounted for 38 per cent of the group total. A full six-month contribution from the Reid and Richco acquisitions helped drive divisional revenues by 61 per cent to £124m. Moreover, the integration of the new businesses is also delivering cost savings "in line with expectations". Despite upward pressure on input prices, Filtrona's gross margin ticked up by 50 basis points on a constant currency basis to 36.9 per cent.
Deutsche Bank anticipates full-year EPS of 29.1p (24.3p in 2011), rising to 33.3p in 2013.
| FILTRONA (FLTR) | ||||
|---|---|---|---|---|
| ORD PRICE: | 478p | MARKET VALUE: | £1bn | |
| TOUCH: | 478-479p | 12-MONTH HIGH: | 491p | LOW: 286p |
| DIVIDEND YIELD: | 2.3% | PE RATIO: | 22 | |
| NET ASSET VALUE: | 103p* | NET DEBT: | 83% | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 269 | 37.8 | 12.5 | 3.3 |
| 2012 | 325 | 40.8 | 13.3 | 3.9 |
| % change | +21 | +8 | +6 | +18 |
Ex-div: 26 Sep Payment: 26 Oct *Includes intangible assets of £216m, or 103p a share | ||||
