The fall in pre-tax profits in the period failed to reflect the underlying picture at McBride - Europe's leading supplier of private label household and personal care products.
Turnover improved as the company continued to bolster its market share. McBride operates in the UK, France, Germany and Spain, as well as in eastern Europe, and all of these markets have seen consumer spending come under pressure. But there has also been a shift by consumers away from higher priced brands and towards own-label products.
However, profits were dented by a £5.7m exceptional charge relating to restructuring costs - mainly redundancies - while margins were also hit by a rise in raw material costs. McBride has managed to pass on some of these costs by increasing its prices, but there's an inevitable time lag, as well as increased pressure from retail outlets to keep prices down. On the plus side, earnings generated in euros and the Polish zloty were boosted by sterling's weakness.
Subject to revision, Investec is forecasting adjusted full-year pre-tax profits of £24.8m and EPS of 10p (£21.3m and 8.6p in 2008).
for a guide to the terms used in IC results tables
For more analysis of company results as they're released, go to www.investorschronicle.co.uk/results
| MCBRIDE (MCB) | ||||
|---|---|---|---|---|
| ORD PRICE: | 127p | MARKET VALUE: | £229m | |
| TOUCH: | 126-129p | 12-MONTH HIGH: | 132p | LOW: 73p |
| DIVIDEND YIELD: | 4.4% | PE RATIO: | 33 | |
| NET ASSET VALUE: | 69p* | NET DEBT: | 85% | |
| Half-year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2007 | 343 | 11.2 | 4.60 | 1.70 |
| 2008 | 392 | 5.00 | 2.10 | 1.70 |
| % change | +14 | -55 | -54 | - |
Ex-div:22 Apr Payment:22 May *Includes intangible assets of £37m, or 21p a share | ||||
