A programme of share buybacks boosted earnings per share for high-end interior decorator and fabric designer Colefax Group (CFX). But the strength of sterling and a fallow period for the interior decorating business held back the other headline numbers.
An otherwise positive set of half-year results was marred by a 37 per cent drop in sales from the small decorating business, which consequently incurred a loss of £365,000, against a profit of the same magnitude in 2013. Management do not expect the division, which had a bumper 2013, to return to profit in the second half.
They are more upbeat about US sales, though, which account for around half of revenues. Although underlying US growth of 9 per cent for the fabrics division - which represents nine-tenths of total group revenues – was masked by a weak dollar during the period, that should unwind now that the greenback is strengthening. Colefax is concentrating future investment in the region.
The picture is weaker this side of the Atlantic. In Europe the problem is flaccid consumer spending and the weakening euro; in Britain it is the recent introduction of a punitive stamp-duty band on high-end housing and the possibility of a mansion tax.
House broker Peel Hunt expects 2015's full-year profit to edge ahead to £5m, giving EPS of 30.7p (up from £4.9m and 27.9p)
| COLEFAX GROUP (CFX) | ||||
|---|---|---|---|---|
| ORD PRICE: | 363p | MARKET VALUE: | £40m | |
| TOUCH: | 350-375p | 12-MONTH HIGH: | 408p | LOW: 335p |
| DIVIDEND YIELD: | 1.2% | PE RATIO: | 13 | |
| NET ASSET VALUE: | 211p | NET CASH: | £4.7m | |
| Half-year to 31 Oct | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 39.2 | 3.1 | 17.0 | 2.0 |
| 2014 | 37.4 | 2.9 | 18.1 | 2.1 |
| % change | -4 | -6 | +6 | +5 |
Ex-div: 5 Mar Payment: 10 Apr | ||||
