There were some encouraging noises on Lavendon’s (LVD) UK business in these results. Lavendon, which rents out crane-like equipment for aerial construction work, said its end markets were starting to indicate cyclical recovery. “We are becoming a bit more optimistic,” says chief executive Don Kenny. A 6 per cent fall in UK rental revenues at the half-year stage had softened to a 4 per cent drop by the year-end. And there was also some good news on pricing. Rates were down 1 per cent year-on-year in the first half, but picked up in the second half to finish the year higher than 12 months before.
Whilst the UK business appears to be moving onto a firmer footing, its profit performance last year clearly showed the impact of what have been tough trading conditions. Underlying operating profit slipped 14 per cent to £16.5m. The UK was still the largest contributor to group profit, making up almost half of total underlying operating profits. But the Middle East is not far behind, following a strong showing last year that saw underlying operating profits jump 33 per cent to £14m. Lavendon says prospects in the region remain promising, with current and planned infrastructure and construction projects worth over $2tn.
Broker Peel Hunt expects adjusted pre-tax profit of £34m and adjusted earnings per share of 15.6p this year (2013: £30m/14.2p).
LAVENDON (LVD) | ||||
---|---|---|---|---|
ORD PRICE: | 206p | MARKET VALUE: | £ 346m | |
TOUCH: | 205-208p | 12-MONTH HIGH: | 220p | LOW: 147p |
DIVIDEND YIELD: | 1.7% | PE RATIO: | 18 | |
NET ASSET VALUE: | 126p* | NET DEBT: | 46% |
Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
---|---|---|---|---|
2009 | 227 | -47.8 | -77.5 | 1.6 |
2010 | 217 | 10.9 | 5.0 | 1 |
2011 | 225 | 14.2 | 9.2 | 1.75 |
2012 | 235 | 20.8 | 9.8 | 2.75 |
2013 | 237 | 23.4 | 11.4 | 3.55 |
% change | +1 | +13 | +16 | +29 |
Ex-div: 05 Mar Payment: 30 Apr * Includes intangible assets of £87.2m, or 52p a share |