A series of big contract wins at logistics specialist Clipper (CLG) have driven its shares up by more than 40 per cent since the group floated at the end of May. SuperGroup (SGP) and Philip Morris (us:PM) are among recent names to be signed, and they join a long list of other household-name clients, including Tesco (TSCO), Asos (ASC) and British American Tobacco (BATS).
The company started life 22 years ago and, from simply transporting goods for retailers, Clipper has moved into a range of other areas. That includes selling and repairing vehicles and, more recently, managing returns of unwanted goods for online retailers. While the core logistics business grew sales 18 per cent year on year to £49m, it's work for online retailers - branded as Boomerang - that's growing fastest: revenues there increased by more than a third to £27m.
Moreover, with the online retail market expected to grow significantly - and with consumers returning about a quarter of purchases - Boomerang should see plenty more growth. Clipper's £5.7m acquisition of Servicecare this month also extends Boomerang's reach to electronic products, where returns are significantly driven by legislative requirements. Cash flow is growing fast, too, and management sounds keen to put it to use with further deals - in Europe and the UK.
Broker Numis Securities has upgraded its full-year pre-tax profit estimate by 3 per cent to £10.7m, giving EPS of 8.4p (from £8.8m and 7.7p).
| CLIPPER LOGISTICS (CLG) | ||||
|---|---|---|---|---|
| ORD PRICE: | 143p | MARKET VALUE: | £143m | |
| TOUCH: | 140-146p | 12-MONTH HIGH: | 170p | LOW: 100p |
| DIVIDEND YIELD: | 1.1% | PE RATIO: | 36 | |
| NET ASSET VALUE: | 14p* | NET DEBT: | 102% | |
| Half-year to 31 Oct | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 93 | 2.1 | 1.5 | nil |
| 2014 | 112 | 3.6 | 2.7 | 1.6 |
| % change | +20 | +67 | +80 | - |
Ex-div: 11 Dec Payment: 31 Dec *Includes intangible assets of 19.5m, or 20p a share | ||||
