Since it started to develop its Conductive Inkjet Technology (CIT) in 2004, Carclo has spent almost £9m on what it describes as a “pretty gutsy investment”. The technology uses proprietary inks to print copper circuits onto non-porous substrates or films and the initial target market is touch screens for non-Apple smart phones and tablets.
Carclo claims CIT is both cheaper and more effective than rival products. Atmel, the leading maker of touch screen controllers, certainly thinks so as it is due to pay Carclo $10m (£6.4m) on the first commercial shipment due shortly. Three pilot schemes using the company’s film, plus imaging and development lines have been set up overseas: the key deal is that Carclo will supply all the film via Atmel under a 10-year agreement.
Set against this, the company's latest results seem quite demure. Profits were down partly because bumper medical contracts boosted the prior half-year numbers but also because exceptional costs of £1.18m were incurred on exiting a motor deal with Ford.
Admittedly, CIT’s timescale has slipped a bit, but it should still be a significant revenue generator in 2012-13. So broker Brewin Dolphin has trimmed its full-year adjusted pre-tax profit expectations from £8.8m to £7.9m (2010-11 £7.3m) giving EPS of 10.1p.
CARCLO (CAR) | ||||
|---|---|---|---|---|
| ORD PRICE: | 297.5p | MARKET VALUE: | £184m | |
| TOUCH: | 290-305p | 12-MONTH HIGH: | 352.5p | LOW: 196p |
| DIVIDEND YIELD: | 0.8% | PE RATIO: | 36 | |
| NET ASSET VALUE: | 73p* | NET DEBT: | 42% | |
| Half-year to 30 Sep | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2010 | 43.8 | 2.48 | 3.0 | 0.70 |
| 2011 | 47.0 | 1.28 | 1.6 | 0.75 |
| % change | +7 | -48 | -47 | +7 |
Ex-div: 29 Feb Payment: 10 Apr *Including intangibles of £37.2m, or 60p a share. | ||||
