Braemar's (BMS) recent merger with competitor ACM Shipping dominated the shipbroker's first-half figures. Indeed, more than £3m of one-off costs related to the deal, as well as subsequent restructuring, weighed heavily on pre-tax profits. Strip these out, however, and pre-tax profit still fell by £1.3m year on year to £3.2m.
The group's technical division suffered from a drop in oil and gas exploration activity in the Far East. Chief executive James Kidwell said that could be related to the recent softening in global oil prices. But he's more optimistic for the second half, which should include revenues from a large contract for supervising the construction of six liquefied natural gas carriers, as well as the training of local staff.
Finance director Martin Beer reckons the second half should include lower exceptional costs, too. Only £1m of further deal-related costs are expected before the year-end and Mr Beer expects gains to be made from potential property disposals. Even better, the group - which now trades as Braemar ACM Shipping - expects to save £4m a year after several merger-driven staff redundancies.
Broker Charles Stanley expects full-year pre-tax profit of £10m, giving EPS of 29.6p (from 30.6p in 2014) and a 26p dividend.
| BRAEMAR SHIPPING SERVICES (BMS) | ||||
|---|---|---|---|---|
| ORD PRICE: | 455p | MARKET VALUE: | £136m | |
| TOUCH: | 440-470p | 12-MONTH HIGH: | 585p | LOW: 408p |
| DIVIDEND YIELD: | 5.7% | PE RATIO: | 17 | |
| NET ASSET VALUE: | 345p* | NET DEBT: | 5% | |
| Half-year to 31 Aug | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 63.9 | 4.5 | 16.1 | 9.0 |
| 2014 | 64.5 | 0.2 | 11.7 | 9.0 |
| % change | +1 | -96 | -27 | - |
Ex-div:13 Nov Payment:12 Dec *Includes intangible assets of £80.6m or 270p per share | ||||
