A wave of higher-margin new products compensated for flat organic revenues at Laird (LRD) last year to drive underlying pre-tax profit up 17 per cent to £60.7m. That beat consensus estimates and more launches from Apple and Samsung mean the second half of 2013 will be better than the first. However, dropping lower-margin work, and inventory juggling at Apple, will make for a flat first quarter.
It's clear why. Apple's iPhones aren't selling as fast as they were and parts have piled up. Laird did almost £99m-worth of work for the company in 2012, £30m more than the previous year. Both divisions contributed to a 120 basis point increase in operating margin to 13.1 per cent. Underlying operating profit grew 14 per cent to £48.9m at the larger performance materials unit, driven by double-digit growth in sales of electromagnetic shielding materials, mostly for smartphones. Those devices need bandwith and coverage, too, so no surprise to see a surge in demand for Laird's infrastructure antenna systems at the wireless systems business, where profits also rose 14 per cent. Supplying telematics to car manufacturers such as Ford, GM and Chrysler remained lucrative and big orders for the latest GPS systems will find their way to the bottom line next year.
Broker Espirito Santo expects pre-tax profit of £55.1m in 2013, giving EPS of 20.8p.
LAIRD (LRD) | ||||
|---|---|---|---|---|
| ORD PRICE: | 249p | MARKET VALUE: | £665.8m | |
| TOUCH: | 249-250p | 12-MONTH HIGH: | 253p | LOW: 170p |
| DIVIDEND YIELD: | 4% | PE RATIO: | 14 | |
| NET ASSET VALUE | 165p* | NET DEBT: | 24% | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2008 | 635 | 26.5 | 7.00 | 10.3 |
| 209 | 529 | 4.60 | -0.80 | 6.00 |
| 2010 | 414 | -8.60 | -6.00 | 6.30 |
| 2011 | 491 | 29.3 | -44.8 | 8.00 |
| 2012 | 520 | 45.1 | 17.5 | 10.0 |
| % change | +6 | +54 | - | +25 |
Ex-div: 8 May Payment: 7 Jun *Includes intangible assets of £513.5m, or 192p a share | ||||
