Engineering losses may have shrunk to £0.3m (from a loss of £1m in the same period of 2011) and the division managed to break even in the autumn, but revenue tumbled 22 per cent to £15.2m and de-stocking during the second quarter tipped it back into the red. Still, building products are selling well and profits there jumped to £4m from just £1.7m a year ago. The first slug of cash from Alumasc’s £11m roofing and walling contract for the Kitimat smelter in Canada came through. So did demand for insulated render via the government’s Community Energy Savings Programme, and the £3.3m solar blinds project at Chiswick Park. There’s good order visibility, too. Alumasc already has £46m of work booked, and more of it from overseas. Its blinds are increasingly popular in the Middle East and France, and foreign airports and ports are looking at its special access covers and slot drains.
Broker Peel Hunt expects adjusted pre-tax profit of £4.6m for the full-year, giving adjusted EPS of 9.7p (£1.6m and 3p in 2012).
|ORD PRICE:||102p||MARKET VALUE:||£36.8m|
|TOUCH:||100-104p||12-MONTH HIGH:||133p||Low: 53.5p|
|DIVIDEND YIELD:||2.9%||PE RATIO:||41|
|NET ASSET VALUE:||54p*||NET DEBT:||43%|
|Half-year to 31 Dec||Turnover (£m)||Pre-tax profit (£m)||Earnings per share (p)||Dividend per share (p)|
Ex-div: 6 Mar
Payment: 9 Apr
*Includes intangible assets of £19.7m, or 55p per share
Alumasc's precision engineering business should break even for the second half and building products could soon benefit from more government energy saving projects. Still, there’s plenty left to do here, so, on a forward PE ratio of 10.5, we continue to rate the shares a hold.
Last IC view: Hold, 76p, 4 September 2012