The combination of cost savings, restructuring, acquisitions and a recovery in its end markets returned pan-European electronic components distributor Acal back to profitability last year.
On an underlying basis, operating profits ramped up from £2.8m in the first half to £4.6m in the second half, partly due to £3m of cost savings from the integration of the acquisition of BFi, but also reflecting a robust performance from Acal's electronic division, which has seen stellar growth from German manufacturing end markets and a rebound in southern Europe. On a like-for-like basis, turnover from that unit rose 27 per cent and the momentum is continuing as the divisional order book was over 20 per cent ahead at the end of March and the current order backlog is around £70m. The electronics division now accounts for 80 per cent of revenues.
And with annualised cost savings of £4.4m now achieved, operating margins, which trebled year on year to 3.3 per cent in the second half, and profits are set to rise even further. Subject to review, broker Oriel Securities forecasts current year underlying EPS of 23.1p (18.6p in 2011).
Acal (ACL) | ||||
|---|---|---|---|---|
| ORD PRICE: | 332p | MARKET VALUE: | £956m | |
| TOUCH: | 325-339p | 12-MONTH HIGH: | 375p | LOW: 147p |
| DIVIDEND YIELD: | 2.3% | PE RATIO: | 55 | |
| NET ASSET VALUE: | 180p* | NET CASH: | £6.7m | |
| Year to 31 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2007 | 165 | 3.7 | 44.4 | 21.90 |
| 2008 | 160 | 2.6 | 105.7 | 21.90 |
| 2009 | 165 | -32.6 | -140.5 | 7.00 |
| 2010 | 182 | -6.3 | -24.5 | 7.00 |
| 2011 | 265 | 1.9 | 6.0 | 7.47 |
| % change | +46 | - | - | +7 |
Ex-div: 15 Jun Payment: 29 Jul *Includes intangible assets of £21.1m, or 74p a share | ||||
