Aga Rangemaster (AGA) delivered a strong second-half profit performance, despite declining cooker sales. Revenues for the year were £6m lower but, following cost-cutting measures taken since 2008, operating profits improved from £1.5m in the first half to £5m in the second half. Chief executive William McGrath was upbeat: "While a market upturn in the near future is unlikely, our prospects are good". He also highlighted a major spring marketing campaign and a new trading relationship with Chinese manufacturer Vatti. Broker Espirito Santo seems convinced: it pencilled in a £0.9m improvement in current year adjusted pre-tax profits to £7.2m, giving EPS of 8.1p (7.1p in 2012).
Last year, sales of the company's AGA range were stable, although the Rayburn and Stanley lines dragged overall cast iron sales down from 11,000 to 10,300 units. Rangemaster brands also struggled, falling from 62,000, to 60,000 units. Rising house prices may be comforting for home owners, but a more important indicator for Aga are the latest housing transaction figures, and the latest numbers from LSL Property Services offered little to get excited about.
Aga took major steps last year to try to plug the yawning gap in its legacy pension fund, making a one-off £16m pension fund injection, which largely explains why the company's net cash position is down from £31.3m a year ago to £5.5m at the financial year-end. Aga added that no further deficit payments are expected until a further £4m due in 2015.
AGA RANGEMASTER (AGA) | ||||
|---|---|---|---|---|
| ORD PRICE: | 86p | MARKET VALUE: | £60m | |
| TOUCH: | 85-86.25p | 12-MONTH HIGH: | 92p | LOW: 51p |
| DIVIDEND YIELD: | nil | PE RATIO: | 9 | |
| NET ASSET VALUE: | 204p* | NET CASH: | £5.5m | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2008 | 279 | 14.4 | 14.4 | 4.00 |
| 2009 | 245 | 0.5 | 2.5 | nil |
| 2010 | 259 | 19.9 | 20.5 | 1.70 |
| 2011 | 251 | 7.5 | 18.8 | 1.90 |
| 2012 | 245 | 8.4 | 10.0 | nil |
| % change | -3 | +12 | -47 | -100 |
*Includes intangible assets of £90m, or 129p a share | ||||
