These impressive interim results from Northbridge Industrial Services (NBI) go a long way towards justifying the 73 per cent rise in the company's share price over the past 12 months. Providing niche industrial products and services to customers around the world has allowed the company to grow its business organically at a healthy clip. The Middle East and Asia Pacific divisions, in particular, have seen significant top-line growth, says chairman Peter Harris.
Some of the outperformance year-on-year can be put down to a weak comparable period in 2012. Some large contracts last year were delayed into the second half, whereas this year the split is likely to be nearer 50-50. Encouragingly, the first-half gross profit figures are roughly half current forecasts for the full year.
Northbridge also announced a sizeable acquisition alongside these results. It is buying an independent distributor of its products for £6.63m - roughly five times cash profits. The business is based in Singapore and should bring some synergies, a larger fleet and an improved footprint in Asia. The purchase is being funded mainly by a placing with institutional shareholders.
Broker N+1 Singer forecasts pre-tax profits of £6.5m, with EPS of 32.2p, in the current year, rising to £7.4m and 37p in 2014 (from £5.6m and 28.2p in 2012).
NORTHBRIDGE INDUSTRIAL SERVICES (NBI) | ||||
|---|---|---|---|---|
| ORD PRICE: | 423p | MARKET VALUE: | £66.0m | |
| TOUCH: | 418-427p | 12-MONTH HIGH: | 423p | LOW: 216p |
| DIVIDEND YIELD: | 1.3% | PE RATIO: | 14 | |
| NET ASSET VALUE: | 194p* | NET DEBT: | 37% | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 14.2 | 1.41 | 6.70 | 1.85 |
| 2013 | 18.6 | 2.57 | 12.6 | 2.00 |
| % change | +31 | +82 | +88 | +8 |
Ex-div: 25 Sep Payment: 28 Oct *Includes intangible assets of £9.67m, or 62p a share | ||||
