Midwich's (MIDW) maiden full-year figures will find favour with shareholders who got in at the time of last May's initial public offering. The group booked a 15 per cent constant-currency increase in revenue, while the adjusted operating margin ticked up 20 basis points to 5 per cent, partly as a consequence of a more favourable product mix.
But tinkering at the margins isn't an overriding obsession, according to Midwich's managing director, Stephen Fenby. Instead, he identifies the group's "depth of technical knowledge" with regard to its specialist audiovisual and document products as its primary "differentiator" as a distributor. He also highlighted the benefits that flow through as a result of the durability of relationships with both its vendors and trade customers.
Nevertheless, he concedes that the group's commercial offering can also benefit from "volume, scale and product selection", so it remains on the look out for suitable acquisitions. During the period it bought a majority stake in Holdan Ltd and the trade and assets of Wired Ltd, strengthening its market position domestically and in Australasia.
Investec gives adjusted pre-tax profit and EPS of £19.4m and 19p, respectively, for the December 2017 year-end (from £17.9m and 18.6p in 2016).
| MIDWICH (MIDW) | ||||
|---|---|---|---|---|
| ORD PRICE: | 336p | MARKET VALUE: | £267m | |
| TOUCH: | 325-350p | 12-MONTH HIGH: | 355p | LOW: 195p |
| DIVIDEND YIELD: | 2.6% | PE RATIO: | 31 | |
| NET ASSET VALUE: | 57p** | NET DEBT: | 32% | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 (M&R 320 Ltd)* | 234 | 8.9 | na | na |
| 2014 (Jade 320 Ltd)* | 281 | 7.3 | na | na |
| 2015 (Jade 320 Ltd)* | 314 | 8.6 | 7.1 | na |
| 2016 | 370 | 12.1 | 10.9 | 8.62 |
| % change | +18 | +41 | +53 | - |
Ex-div: 23 Mar Payment: 21 Apr *Pro-forma figures for previous holding companies. Dividends of 7.7p a share were paid to shareholders of M&R 320 in 2013. **Includes intangible assets of £23.4m, or 29p a share. | ||||
