A week prior to the release of these half-year figures, Alkane Energy announced details of a new gas supply contract with a waste facility in Dagenham. The deal, worth £1.6m, was Alkane's fourth biogas contract, and it underlined the progress made by the company since the completion of the Greenpark Energy acquisition in April.
Alkane's revenues benefited primarily from 2011 legacy contracts, which resulted in an average selling price (ASP) of £56/MWh - a 14 per cent increase over last year’s interims. However, management's guidance is for ASP to fall to £52/MWh for the whole of 2012, while a third of 2013’s expected output has already been sold for £51/MWh.
Though headline earnings fell during the six-month period, this was largely due to £274,000 in exceptional items relating to the Greenpark acquisition, although Alkane was forced to fork out an additional £105,000 in finance costs. However, strip out exceptional items and Alkane's adjusted pre-tax profit rose 7 per cent to £958,000.
Daniel Stewart expects full-year pre-tax profits of £3m and EPS of 2.7p (2011: £2m and 2.3p), based on a rise in revenues from £9.5m to £15.2m.
| ALKANE ENERGY (ALK) | ||||
|---|---|---|---|---|
| ORD PRICE: | 21.25p | MARKET VALUE: | £21m | |
| TOUCH: | 20.5-22p | 12-MONTH HIGH: | 23p | LOW: 16p |
| DIVIDEND YIELD: | nil | PE RATIO: | 12 | |
| NET ASSET VALUE: | 22p | NET DEBT: | 54% | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 5.00 | 0.72 | 0.97 | nil |
| 2012 | 5.29 | 0.68 | 0.78 | nil |
| % change | +6 | -5 | -20 | - |
