Adding back reorganisation and pension-related charges still left specialist technology group Molins (MLIN) with a 60 per cent drop in underlying pre-tax profit to £600,000 at the half-year stage.
Most of this reflected a sales slump at the tobacco machinery division, the biggest contributor to group profits. Sales here slid from £18m to £10m on reduced order demand and the deferral of two large orders to the Middle East and Eastern Europe. But new initiatives, such as the launch of a new cigarette packing machine, should have a positive impact over the medium-term.
The scientific services unit, however, saw sales rise 3 per cent to £11.7m. A new instrument for testing e-cigarettes has been launched and strong interest has already resulted in initial sales. Orders grew for laboratory-based analytical services, too, although overall sales fell because last year’s outcome was boosted by a large one-off sale.
The packaging division's sales grew 9 per cent - but actually fell marginally to £18.3m after accounting for the strength of sterling - while operating profit here was flat at £100,000. Plans are in place to widen the division’s customer base, notably in the pharmaceutical and healthcare sectors.
Broker Panmure Gordon has downgraded its full-year forecasts by 10 per cent to pre-tax profit of £5.1m, giving EPS of 18.6p (from £5.4m and 22.6p in 2013).
MOLINS (MLIN) | ||||
---|---|---|---|---|
ORD PRICE: | 136p | MARKET VALUE: | £27.5m | |
TOUCH: | 134-138p | 12-MONTH HIGH: | 195p | LOW: 134p |
DIVIDEND YIELD: | 4.0% | PE RATIO: | 10 | |
NET ASSET VALUE: | 175p* | NET DEBT: | 3% |
Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
---|---|---|---|---|
2013 | 47.8 | 0.7 | 3.5 | 2.5 |
2014 | 40.0 | -0.1 | -0.9 | 2.5 |
% change | -16 | - | - | - |
Ex-div: 17 Sep Payment: 9 Oct *Includes intangible assets of £15.7m, or 78p a share |