The difficulties of the current business cycle were evident in these full-year results from chemicals company AZ Electronic Materials (AZEM) - which supplies the electronics chip industry. Indeed, performance varied greatly over 2012's two halves, although management expects modest sales growth this year, with most improvement expected in the second half as companies gear up to launch new electronic devices and the supply chain rebalances.
Challenging economic conditions hampered growth in the group's semi-conductors business, however, which is the fundamental growth driver for AZ. This hit the main IC materials operation the hardest and sales there were roughly flat at $537m (£342m.) Although the Optronics segment, which is most exposed to the smartphone and tablet market, performed rather better and sales there rose 6 per cent to $237m. In fact, the growth of new devices like tablet computers has allowed AZ's sales to become more diversified. "So far there has been undersupply of material as manufacturers have re-organised for their late-year launches, which is why we expect a better performance in the second half of 2013," said chief executive Geoff Wild.
Goldman Sachs forecasts pre-tax profit of $228m for 2013, and underlying EPS of 39¢, rising to 44¢ in 2014 (from $211.7m and 35¢ in 2012).
AZ ELECTRONIC MATERIALS (AZEM) | ||||
|---|---|---|---|---|
| ORD PRICE: | 376p | MARKET VALUE: | £1.43bn | |
| TOUCH: | 374-376p | 12-MONTH HIGH: | 394p | LOW: 262p |
| DIVIDEND YIELD: | 2.2% | PE RATIO: | 27 | |
| NET ASSET VALUE: | 199¢* | NET DEBT: | 38% | |
| Year to 31 Dec | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2009** | 500 | -310 | -151 | nil |
| 2010 | 682 | -90.6 | -56.9 | nil |
| 2011 | 792 | 126 | 25.3 | 12.3 |
| 2012 | 794 | 129 | 21.8 | 13.1 |
| % change | - | +2 | -14 | +7 |
*Includes intangible assets of $960m, or 252¢ a share **Prior to flotation £1=$1.57 | ||||
