Since chief executive Steve Blair took the hot seat in March, e2v technologies' (E2V) drive to simplify life for its customers appears to be paying off. Despite weak macro-economic conditions and currency headwinds, the radio-frequency, microwave and semiconductor specialist posted adjusted operating profits of £17.5m for the first half - up from £12m last year. The operating margin rose by five percentage points, while the order book was up 6 per cent.
Mr Blair attributed these gains to his bid to put the customer first. Describing the previous regime as doing a bad job of explaining its technology, he said new efforts to make customers partners were finally enabling the group to unleash its full potential. By 2020 Mr Blair wants to double adjusted operating profits, with organic growth contributing two-thirds of the increase and acquisitions the rest.
Sales in the radio-frequency business, RF Power, rose 11 per cent to £41.8m, thanks to strong demand for radiotherapy products and industrial applications of e2v's technology. The group’s imaging business also posted top-line gains on the back of growth in space imaging and success in Asia. Less successful was the semiconductor business, where revenues fell 8 per cent to £23m. Aside from currency headwinds, the division suffered from lower demand for microprocessors and assembly and test services in Europe.
Broker Investec expects pre-tax profits of £35m for the full financial year, giving EPS of 11.8p.
| E2V TECHNOLOGIES (E2V) | ||||
|---|---|---|---|---|
| ORD PRICE: | 164p | MARKET VALUE: | £357m | |
| TOUCH: | 164-165p | 12-MONTH HIGH: | 173p | LOW: 146 |
| DIVIDEND YIELD: | 2.7% | PE RATIO: | 13 | |
| NET ASSET VALUE: | 74p* | NET DEBT: | 7% | |
| Half-year to 30 Sep | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 98.1 | 10.8 | 3.8 | 1.4 |
| 2014 | 102.3 | 13.0 | 4.6 | 1.5 |
| % change | +4 | +20 | +22 | +7 |
Ex-div: 27 Nov Payment: 17 Dec *Includes intangible assets of £99m, or 45p a share | ||||
