At first glance, it's hard to make head or tail of full-year results from stamp and coin dealer Stanley Gibbons (SGI). Despite a profit warning in April, revenues and profits were up - but, nonetheless, the dividend has been cut.
Here's the breakdown. April's profit warning had little to do with underlying trading. Several high-value contracts failed to complete before the financial year-end as had previously been expected. Those transactions will be booked in the first half of the current financial year instead, and chief executive Michael Hall confirmed a number had been completed following the year-end. To cover the shortfall, management cut the total dividend to ensure cover remains in the range of 2.5 and 3 times adjusted earnings.
The reported results were boosted by growth in coins, military medals and other collectibles as strategic acquisitions including Mallett Antiques made a solid contribution. So it is no surprise Mr Hall is focused on further acquisitions as well as building the group's new online marketplace. Vendors are given an online shop within the website, and are thoroughly vetted by industry experts before selling their wares.
Analysts at Peel Hunt expect pre-tax profits of £10m this year, giving EPS of 17p, compared with £7.5m and 12.9p in the year to March 2015.
STANLEY GIBBONS (SGI) | ||||
|---|---|---|---|---|
| ORD PRICE: | 256p | MARKET VALUE: | £120m | |
| TOUCH: | 252-260p | 12-MONTH HIGH: | 328p | LOW: 218p |
| DIVIDEND YIELD: | 2.0% | PE RATIO: | 61 | |
| NET ASSET VALUE: | 176p* | NET DEBT: | 14% | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2010 | 26.4 | 4.3 | 15.2 | 5.5 |
| 2011 | 35.7 | 4.9 | 18.0 | 6.0 |
| 2012 | 35.6 | 5.2 | 18.5 | 6.5 |
| Year to 31 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2014** | 51.8 | 2.2 | 6.3 | 7.0 |
| 2015 | 56.9 | 3.1 | 4.2 | 5.0 |
| % change | +10 | +41 | -34 | -29 |
Ex-div: 9 Jul Payment: 17 Aug *Includes intangible assets of £37.8m, or 81p a share **15-month period following change to financial year-end | ||||
