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Wax Lyrical spares Portmeirion's blushes

Internet and home fragrances successes were overshadowed by a disastrous year of trading in India and South Korea
March 10, 2017

Home fragrances specialist Wax Lyrical and the weak pound helped cover over the cracks of what was otherwise a difficult year for Portmeirion (PMP). The posh crockery maker began its results presentation boasting about an eighth consecutive year of record revenues. Exclude the £10.4m contribution from Wax Lyrical, acquired by the group last May, and record statutory revenues (see table) are reduced to £66.3m, a decline of 3 per cent.

IC TIP: Hold

Turnover in India tanked from £5.8m in 2015 to £1.1m, after a mischievous distributor assured management of vigorous demand, before flogging products destined for the country elsewhere. Plenty of that same crockery ended up in South Korea, a difficult market itself, where revenues slid 21 per cent to £10m.

Portmeirion can at least take comfort in markets closer to home. Higher-margin internet sales surged by nearly a third, while revenues in the UK, excluding Wax Lyrical, rose 2 per cent.

Broker Cantor Fitzgerald expects pre-tax profits of £8.7m and EPS of 66.4p for 2017, up from £7.8m and 59.1p in 2016.

PORTMEIRION (PMP)
ORD PRICE:960pMARKET VALUE:£104m
TOUCH:950-970p12-MONTH HIGH:1,268pLOW: 743p
DIVIDEND YIELD:3.4%PE RATIO:16
NET ASSET VALUE:341p*NET DEBT:6%

Year to 31 DecTurnover (£m)Pre-tax profit (£m)Earnings per share (p)Dividend per share (p)
201255.56.647.321.8
201358.37.053.324.0
201461.47.657.626.5
201568.78.666.030.0
201676.77.859.632.25
% change+12-10-10+8

Ex-div: 27 Apr

Payment: 30 May

*Includes intangible assets of £13.8m, or 128p a share