In typical fashion, filters maker Porvair (PRV) has beaten full-year expectations - leading analysts at broker Peel Hunt to upgrade forecasts for the sixteenth time. Growth will be less spectacular in 2013, however - but the year has started well, with a healthy order book and structural drivers firmly in place.
Revenue at the microfiltration division jumped 15 per cent to £48.5m and operating profit grew 19 per cent to £6.7m. A first contribution from the POSCO contract in South Korea helped and orders from all the major aircraft manufacturers boosted aerospace revenue by a fifth. Expect sales from the Airbus 350 to ramp up later this year, too. Meanwhile, a UK government contract to supply ultra fine filters to trap nuclear material is worth £11.3m and will chip in over the next three years Elsewhere, sales of water quality testing kits are rising and the Chinese are getting increasingly fussy, so expect a flood of business there.
A trio of new higher-margin products at the metals filtration unit are winning market share, so divisional profit rocketed 63 per cent to £2.4m. A flat automotive market will likely knock profits this year, but management thinks double-digit margins are on the cards and Porvair has already won initial trial orders for a new range of filters.
Peel Hunt expects pre-tax profit of £6.6m in 2013, giving EPS of 10.6p.
PORVAIR (PRV) | ||||
|---|---|---|---|---|
| ORD PRICE: | 177p | MARKET VALUE: | £75.4m | |
| TOUCH: | 175-177p | 12-MONTH HIGH: | 183p | LOW: 102p |
| DIVIDEND YIELD: | 1.5% | PE RATIO: | 18 | |
| NET ASSET VALUE | 106p* | NET DEBT: | 9% | |
| Year to 30 Nov | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2008 | 54.8 | 4.16 | 7.0 | 2.25 |
| 2009 | 55.2 | 1.06 | 1.6 | 2.25 |
| 2010 | 63.6 | 3.13 | 5.2 | 2.30 |
| 2011 | 68.1 | 4.51 | 7.3 | 2.40 |
| 2012 | 76.5 | 6.30 | 10.1 | 2.60 |
| % change | +12 | +40 | +38 | +8 |
Ex-div: 1 May Payment: 7 Jun *Includes intangible assets of £40m, or 94p a share | ||||
