Michelmersh Brick (MBH) warned last year that operational issues at two of its brick plants would leave profit flat for the year to December 2016, and so it proved. However, cash generation remains a source of strength, so shareholders have been rewarded with a doubling in the dividend pay-rate for the third year running.
Production issues have now been resolved, and while bricks produced fell from 69.5m to 68.6m, a new £1m kiln at the Michelmersh site is now fully operational, while further capital expenditure this year will focus on achieving greater energy efficiency.
As well as strong demand for specialist bricks and other products for use in new-build housing, Michelmersh also enjoyed solid support from the repair, maintenance and improvement (RMI) sector. Much of this reflected demand for products resulting from a big spike in office to residential conversions.
Analysts at Cenkos are forecasting adjusted pre-tax profit for the year to December 2017 of £4.4m and EPS of 4.4p (from £4.8m and 4.6p in 2016).
| MICHELMERSH BRICK (MBH) | ||||
|---|---|---|---|---|
| ORD PRICE: | 58p | MARKET VALUE: | £47m | |
| TOUCH: | 57-59p | 12-MONTH HIGH: | 86p | LOW: 46p |
| DIVIDEND YIELD: | 3.4% | PE RATIO: | 13 | |
| NET ASSET VALUE: | 66p | NET CASH: | £4.7m | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 23.0 | 0.4 | 0.5 | nil |
| 2013 | 25.9 | 0.4 | 0.2 | nil |
| 2014 | 28.5 | 2.6 | 2.7 | 0.5 |
| 2015 | 29.1 | 4.6 | 4.4 | 1 |
| 2016 | 30.1 | 4.6 | 4.4 | 2 |
| % change | +3 | - | -1 | +100 |
Ex-div: 1 Jun Payment: 30 Jun | ||||
