Management in ground engineering group Keller (KLR) described its most recent results as "mixed", and it is not hard to see why. Revenue reached a record £1.8bn for the year, driven by a combination of currency movements and a strong underlying performance in its European operations, but underlying profit before tax fell 21 per cent in constant currency on the back of weakness elsewhere.
The major US division was flat at constant currencies, but the Europe, Middle East and Africa division grew revenue 16 per cent, on the same basis, to £553m, with good showings for its most significant operations in the UK, Germany, Poland and Austria. But it was a difficult year for the division's other locales. Big-ticket contracts that have been sealed for projects in Egypt, South Africa and Abu Dhabi should make 2017 look better on this score.
Asia-Pacific continued to drag. Revenue shrank 8 per cent in constant-currency terms to £275m and last year's £11.7m underlying operating profit was largely attributed to the standalone Wheatstone liquefied natural gas project in Australia. The division made an £18m underlying operating loss for 2016, and a return to profit is not expected until 2018.
Analysts at Investec Securities are forecasting pre-tax profit of £104m, giving diluted EPS of 92.7p in 2017 (from £85.1m and 74.8p in 2016).
KELLER (KLR) | ||||
|---|---|---|---|---|
| ORD PRICE: | 854p | MARKET VALUE: | £615m | |
| TOUCH: | 854-857p | 12-MONTH HIGH: | 1,044p | LOW: 643p |
| DIVIDEND YIELD: | 3.3% | PE RATIO: | 13 | |
| NET ASSET VALUE: | 591p* | NET DEBT: | 71% | |
| Year to 31 Dec | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 1.30 | 43.5 | 45.9 | 22.8 |
| 2013 | 1.44 | 52.0 | 43.2 | 24.0 |
| 2014 | 1.60 | 28.2 | -4.2 | 25.2 |
| 2015 | 1.56 | 56.3 | 35.5 | 27.1 |
| 2016 | 1.78 | 73.9 | 65.7 | 28.5 |
| % change | +14 | +31 | +85 | +5 |
Ex-div: 18 May Payment: 9 Jun *Includes intangible assets of £188m, or 261p a share | ||||
