New chief executive Rik De Vos is again rolling up his sleeves at cleaning and personal care product maker McBride (MCB). Not content with a UK restructure, which has already realised £4.9m of savings this year, the company has unveiled a 'repair, prepare, grow' strategy. This is likely to focus on growing its business in Europe, given that it already commands a 90 per cent share of the private-label market in the UK.
Operating profits swung from a £13.9m loss last year to a £9.7m gain, and would have been healthier still had it not been for nearly £19m in exceptional items. Chief financial officer Chris Smith said it had written off goodwill it was holding against an Italian investment from a previous acquisition, and had taken impairments on an air care and aerosol business. It also closed a factory in China, where it will now operate with only a product-sourcing team.
The company has taken what it called the "prudent" decision to reduce the dividend while it gets its ducks in a row. Mr Smith said he wanted cover to be between two and three times rather than less than one, as was the case under the previous management team.
Analysts at Panmure Gordon expect pre-tax profits of £25.4m in the current financial year, leading to EPS of 9.9p, up from £21.7m and 8.3p in FY2015.
MCBRIDE (MCB) | ||||
---|---|---|---|---|
ORD PRICE: | 122p | MARKET VALUE: | £223m | |
TOUCH: | 122-122.5p | 12-MONTH HIGH: | 125p | LOW: 73p |
DIVIDEND YIELD: | 2.9% | PE RATIO: | NA | |
NET ASSET VALUE: | 31p | NET DEBT: | 161% |
Year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
---|---|---|---|---|
2011 | 812 | 7.1 | 2.9 | 6.8 |
2012 | 814 | 12.1 | 5.1 | 5.0 |
2013 | 761 | 9.0 | 3.0 | 5.0 |
2014 | 744 | -21.3 | -10.5 | 5.0 |
2015 | 704 | 2.6 | -0.4 | 3.6 |
% change | -5 | - | - | -28 |
*Includes intangible assets of £20m, or 11p a share |