Running a laundry service in supermarket car parks might seem odd to us, but Photo-Me (PHTM) is impressed with trials in France and an aggressive rollout is under way. If that goes well - over 700 should be in place by next April - and the core photo booth operation keeps growing, finance chief Françoise Coutaz-Replan says she'll increase the dividend by a fifth this year and make another special payout, too.
Highly cash-generative photo booths were behind a 21 per cent increase in group operating profit to £24.2m last year. Photo-me has almost 25,000 of them now and business in Germany, where more photo shops are going under, and new laws require children to have their own passport, is proving lucrative. The company predicts further growth there, and in new markets such as eastern Europe and the Far East, too.
However, these results were flattered by a £2.4m profit on the sale of an industrial building in France, and cash profits rose just 2 per cent to £44.9m. There's been a massive assault on costs in recent years, too, and the benefit is clear given group revenues actually fell 6 per cent. For that, blame the sales and servicing business, where sales of mini-labs to shops are in terminal decline. It's plugged losses, but management admits it's unlikely to make much money.
Broker finnCap expects adjusted pre-tax profit of £28m in 2014, giving adjusted EPS of 5.5p (from £24.3m and 4.8p last year).
PHOTO-ME INTERNATIONAL (PHTM) | ||||
|---|---|---|---|---|
| ORD PRICE: | 87.25p | MARKET VALUE: | £324m | |
| TOUCH: | 87-87.5p | 12-MONTH HIGH: | 90p | LOW: 35p |
| DIVIDEND YIELD: | 3.4% | PE RATIO: | 18 | |
| NET ASSET VALUE: | 26p | NET CASH: | £61.4m | |
| Year to 30 Apr | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2009 | 211 | -5.10 | -4.34 | nil |
| 2010 | 223 | 9.30 | 2.70 | 1.25 |
| 2011 | 220 | 18.0 | 3.77 | 2.00 |
| 2012 | 208 | 20.1 | 3.97 | 2.50 |
| 2013* | 196 | 24.3 | 4.78 | 3.00 |
| % change | -6 | +21 | +20 | +20 |
Ex-div: 25 Sep Payment: 7 Nov *Excludes special dividend of 3p | ||||
