Arden Partners upgraded forecasts just last month. Now, Arden analyst Chris Thomas has raised forecasts for adjusted pre-tax profit by another 9 per cent to £35m, giving adjusted EPS of 18.6p (from £28.1m and 16p for 2012). Yet he still admits these could be conservative. Twice as many passengers booked their break with package holiday business Jet2holidays, mostly popular all-inclusive deals, than last year. Each of the 312,000 holidaymakers paid around 10 per cent more than last year for the privilege, too, swelling revenue by almost £100m. That inevitably meant more passengers for Dart's Jet2.com airline. It flew 3.6m passengers in the six months, increased revenue by 23 per cent to £388m and managed to push profit margins higher - despite operating costs increasing by a fifth.
A big increase in forward bookings for both this winter and next summer helped boost the net cash pile by £98.2m year on year. True, the business is becoming more seasonal - bad news for the second half - but Dart is running extra flights to the Canary Islands through the winter and capacity for next summer will increase by another 11 per cent.
|ORD PRICE:||111p||MARKET VALUE:||£159.2m|
|TOUCH:||110-112p||12-MONTH HIGH:||122p||Low: 57p|
|DIVIDEND YIELD:||1.3%||PE RATIO:||5|
|NET ASSET VALUE:||132p||NET CASH:||£191.9m|
|Half-year to 30 Sep||Turnover (£m)||Pre-tax profit (£m)||Earnings per share (p)||Dividend per share (p)|
Ex-div: 24 Dec
Payment: 01 Feb
Despite rising nearly 60 per cent since late August, Dart's shares trade on just six times forecast earnings - an unfair discount to larger rivals, given its strong cash generation and potential for further growth. They trade below net assets, too. Buy.
Last IC view: Buy, 69p, 22 Jun 2012