The end of the housing boom has been bad news for companies that relied heavily on perpetually rising house prices, and few have been hit harder than upmarket cooker maker, Aga Rangemaster. Indeed, judging by management's cautious outlook, the group is now into its fourth year of difficult trading - leaving the shares likely to tread water, despite an undemanding rating.
Aga sold sold 11,000 cookers last year, down from a scarcely believable 19,600 in 2007 - in line with the 50 per cent collapse in mortgage applications since their peak. In attempting to tackle that tougher climate, the company has been in a state of near constant re-organisation in recent years and, last year, it booked another £2.1m in exceptional charges. Still, that effort has delivered cost savings which helped boost operating profit by £1m to £6.1m in the year. Moreover, Aga should also benefit from a new range of touch screen control cookers designed to appeal to the US market. Management wants to rebalance sales so that half are generated by exports this year, compared with 37 per cent in 2011 - making Aga's easier to install and cheaper to ship will help this.
Espirito Santo forecasts adjusted pre-tax profit of £7.3m, giving adjusted EPS of 7.8p (£6.5m and 7.1p in 2011).
AGA RANGEMASTER (AGA) | ||||
|---|---|---|---|---|
| ORD PRICE: | 86p | MARKET VALUE: | £59.6m | |
| TOUCH: | 85-89p | 12-MONTH HIGH: | 141p | LOW: 55p |
| DIVIDEND YIELD: | 2.2% | PE RATIO: | 5 | |
| NET ASSET VALUE: | 242p* | NET CASH: | £31.3m | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2007 | 292 | 27.0 | 18.9 | 11.5 |
| 2008 | 279 | 14.4 | 14.4 | 4.00 |
| 2009 | 245 | 0.50 | 2.50 | nil |
| 2010 | 259 | 19.9 | 20.5 | 1.70 |
| 2011 | 251 | 7.50 | 18.8 | 1.90 |
| % change | -3 | -62 | -8 | +12 |
Ex-div:18 Apr Payment: 1 Jun *Includes intangible assets of £90.6m, or 131p a share | ||||
