Camera equipment specialist Vitec (VTC) saw first-half operating profit rise 35 per cent year on year to £16.6m, but that's because there was no repeat of last year's £6.2m of restructuring costs. Adjust for these, and other one-off items, and underlying profit actually fell slightly to £19.2m.
The operating margin was maintained at 12.6 per cent, but there was no avoiding adverse currency movements. Management reckons the strong pound hit revenue by £10.3m and dragged operating profit down by £1.8m.
The Videocom division, meanwhile, saw its IMT business deliver a £1.1m loss. Intense competition has prompted Vitec to exit this business and IMT will be sold or closed. However, there was a strong contribution from video encoder specialist Teradek, acquired last year. Profits and turnover fell at the imaging unit, too, mainly because of declines in conventional camera use as the popularity of mobile phone cameras continues to grow - that's prompting retailers to destock. The one bright spot was at the services unit. Revenue there rose 40 per cent to £19.3m, with demand boosted by the winter Olympics and the football World Cup.
Broker Investec Securities expects adjusted full-year pre-tax profit of £34.5m, giving EPS of 53.7p (from £35.6m and 55.8p in 2013) and a 24p dividend.
| VITEC (VTC) | ||||
|---|---|---|---|---|
| ORD PRICE: | 555p | MARKET VALUE: | £245m | |
| TOUCH: | 552-569p | 12-MONTH HIGH: | 730p | LOW: 539p |
| DIVIDEND YIELD: | 4.2% | PE RATIO: | 14 | |
| NET ASSET VALUE: | 271p* | NET DEBT: | 57% | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 158 | 10.1 | 14.9 | 8.9 |
| 2014 | 153 | 14.9 | 23.1 | 9.3 |
| % change | -3 | +48 | +55 | +4 |
Ex-div: 24 Sep Payment: 24 Oct *Includes intangible assets of £75m, or 169p a share | ||||
