Nothing has happened in the five months since Trifast (TRI) announced full-year results to "dull optimism" at the nuts and bolts maker. December's acquisition of Malaysia's Power Steel was the catalyst for double-digit sales growth, but self-help measures put in place over the past 18 months and new higher-margin business are also contributing.
Of course, Asia steals the headlines. It made almost 60 per cent of underlying operating profit during the first half, up 38 per cent to £2.6m on the year before, driven largely by demand from electronics manufacturers. But it's not all about the Far East. Trifast shut down two of its three plants in the US last year and low-margin contracts signed during the nadir of 2009 are being replaced by more commercially attractive ones. That helped double margins in mainland Europe and the US, which made more money in the first six months - £657,000 - than in the whole of last year.
Nissan, Jaguar Land Rover, Audi and Volvo are all doing well and putting business Trifast's way. Big customers such as JCI and Lear are, too, and the company is pitching for business on new products and models coming along in 2013. True, destocking among nervous distributors hit UK revenue, but better margins meant profits grew 5 per cent.
Broker N+1 Singer expects an increase in adjusted pre-tax profit to £7.2m in 2013, giving adjusted EPS of 4.7p (from £5m and 3.8p in 2012).
TRIFAST (TRI) | ||||
|---|---|---|---|---|
| ORD PRICE: | 42.5p | MARKET VALUE: | £45.4m | |
| TOUCH: | 42.5-44p | 12-MONTH HIGH: | 50p | Low: 36p |
| DIVIDEND YIELD: | 1.2% | PE RATIO: | 11 | |
| NET ASSET VALUE: | 52p | NET DEBT: | 14% | |
| Half-year to 30 Sep | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 55.4 | 2.13 | 1.77 | nil |
| 2012 | 61.2 | 3.39 | 2.28 | nil |
| % change | +11 | +59 | +29 | - |
