Nichols' (NICL) share price hit new highs after another outstanding set of results from the soft drink maker. The most impressive part of Nichols' 2012 results is that home sales grew 9 per cent against a 3 per cent increase in UK soft drinks turnover overall, thanks to a double-digit rise in the number of outlets selling Vimto, along with successful new product launches. The top new performer was a line of no-calorie drinks for diet-brand Weight Watchers.
Exports were another favourable factor, with sales up 22 per cent in Africa and an impressive 24 per cent in Europe. Overall, exports were 8 per cent higher but were held back by flat income in the Middle East, partly due to the unfavourable timing of Ramadan. Good cost controls meant the fall in gross margins because of rising prices of raw materials such as plastic, aluminium and sweeteners was reversed at an operating level.
Broker Canaccord Genuity expects underlying pre-tax profits of £22.2m and EPS of 45.4p this year (from £20.2m and 40.9p in 2012). One key to this year's results will be how quickly agreements to distribute products in North Africa via a large French distributor and in equatorial Africa via the Coca-Cola network ramp up. After another increase in net cash, acquisitions could be on the cards, too.
NICHOLS (NICL) | ||||
|---|---|---|---|---|
| ORD PRICE: | 897p | MARKET VALUE: | £327m | |
| TOUCH: | 886-900p | 12-MONTH HIGH: | 905p | LOW: 612p |
| DIVIDEND YIELD: | 2% | PE RATIO: | 22 | |
| NET ASSET VALUE: | 122p* | NET CASH: | £24.7m | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2008 | 56.2 | 4.1 | 8.1 | 11.20 |
| 2009 | 72.4 | 11.9 | 22.9 | 12.20 |
| 2010 | 83.9 | 15.1 | 29.6 | 13.60 |
| 2011 | 98.9 | 18.1 | 36.3 | 15.30 |
| 2012 | 107.8 | 20.5 | 41.4 | 17.30 |
| % change | +9 | +13 | +14 | +13 |
Ex-div: 27 Mar Payment: 3 May *Includes intangible assets of £16m, or 43p a share | ||||
