Carclo considered selling its Conductive Inkjet Technology (CIT) business last year for a mooted £125m. Major shareholders said no and management is now fully committed to developing it, initially for the touchscreen phone and tablet market. And, just to erase any doubts, chief executive Ian Williamson will hand over to CIT boss Chris Malley next March.
Don't be fooled by these modest results, either. CIT may have generated just £300,000 of revenue last year and lost £0.2m, but the project is "out of the shadows" and commercial activity is significant. Indeed, partner Atmel will begin volume production of its XSense touch-sensor product towards the end of the third quarter. Carclo gets about a quarter of any revenues, which could be $15m (£9.6m) next year, given that Atmel predicts about $50m of sales in the second half. Analysts at Brewin Dolphin expect £2.7m of profit from CIT in 2013 and £7m the year after, giving group pre-tax profit of £9.5m and EPS of 12.3p and £14.3m and 18.4p, respectively, in 2014. That looks feasible - eight of the big manufacturers have taken samples in the past six weeks alone, and more are likely.
Elsewhere, lighting for supercars steered underlying operating profit at Carclo's precision products unit up 44 per cent to £3.2m, and new products could emerge in the second half, and possibly at the diagnostics business, too.
CARCLO (CAR) | ||||
|---|---|---|---|---|
| ORD PRICE: | 380p | MARKET VALUE: | £235m | |
| TOUCH: | 376-380p | 12-MONTH HIGH: | 431p | LOW: 240p |
| DIVIDEND YIELD: | 0.6% | PE RATIO: | 51 | |
| NET ASSET VALUE | 71p* | NET DEBT: | 40% | |
| Year to 31 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2008 | 81.3 | 4.50 | 7.70 | 1.90 |
| 2009 | 87.4 | 3.65 | 5.10 | 2.00 |
| 2010 | 81.2 | 4.62 | 5.90 | 2.00 |
| 2011 | 88.6 | 6.77 | 9.60 | 2.20 |
| 2012 | 93.3 | 5.50 | 7.50 | 2.40 |
| % change | +5 | -19 | -22 | +9 |
Ex-div: 15 Aug Payment: 21 Sep *Includes intangible assets of £40.8m, or 66p a share | ||||
