A mixed bag for Augean (AUG) at the half-year mark, with gross profits up 3 per cent to £3.55m aided by a marked increase in waste volumes in the energy and construction segment. This was borne out by a 39 per cent increase in air pollution control residue (APCR) volumes on the comparable period in 2015, which fed through to an overall increase in APCR revenues of 41 per cent. However, group earnings were cut in half due to a £1.7m one-off charge composed primarily of an out-of-court settlement linked to a commercial dispute, together with costs of £0.5m relating to the May deal to acquire Colt Industrial Services.
The results were also held in check due to a material slowdown in the rate of UK government spending in relation to nuclear decommissioning since May 2015. With no clear sign of a likely resumption in this area, management now expects the radioactive waste services business to fall short of management expectations for the 2016 financial year. Predictably, North Sea revenues were significantly down on the first half of 2015, and management has again been forced to admit that this business unit will come up short of previous guidance for the full year.
N+1 Singer gives adjusted profits of £7.5m for the December 2016 year-end, giving rise to EPS of 5.7p, rising to £8.5m and 6.5p in 2017 (from £6m and 4.5p in 2015).
| AUGEAN (AUG) | ||||
|---|---|---|---|---|
| ORD PRICE: | 48.3p | MARKET VALUE: | £49.3m | |
| TOUCH: | 46.5p-50p | 12-MONTH HIGH: | 57p | LOW: 40p |
| DIVIDEND YIELD: | 1.4% | PE RATIO: | 134 | |
| NET ASSET VALUE: | 54p* | NET DEBT: | 23% | |
| Half-year to 30 June | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2015 | 31.3 | 2.9 | 2.2 | nil |
| 2016 | 36.8 | 1.4 | 1.0 | nil |
| % change | +18 | -54 | -56 | - |
Ex-div: - Payment: - *Includes intangible assets of £25.9m, or 25p a share. | ||||
