Record half-year sales for digital security camera specialist IndigoVision (IND) came at the expense of margins and hence the fall in profits in the six-month period.
Increased investment in the sales team and in product development means margins are not likely to recover much in the second half, but, with sales momentum building and with the third quarter comfortably ahead of the corresponding period last year, guidance is for record revenues for the financial year. House broker N+1 Singer expects full-year revenues to rise from £30.3m to £32.4m to produce record pre-tax profits of £3.4m, up from £2.7m the year before. On this basis, the broker expects EPS to increase 30 per cent to 32.7p and the shares are trading on a modest 10 times earnings estimates.
There is a decent prospective yield, too, as the full-year payout is expected to be raised 20 per cent to 12p a share, so the forward dividend yield is 3.6 per cent. Moreover, even though the cash pile has fallen to £0.86m after the payment of a bumper £5.6m special dividend in November, given decent cash generation the cash pile is expected to top £3m by the July year-end.
IndigoVision (IND) | ||||
|---|---|---|---|---|
| ORD PRICE: | 330p | MARKET VALUE: | £25.1m | |
| TOUCH: | 325-333p | 12-MONTH HIGH: | 479p | LOW: 235p |
| DIVIDEND YIELD: | 3.2% | PE RATIO: | 17 | |
| NET ASSET VALUE: | 180p | NET CASH: | £0.86m | |
| Half-year to 31 Jan | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 14.5 | 1.30 | 12.8 | 5.0 |
| 2013* | 16.1 | 0.93 | 10.5 | 5.5 |
| % change | +11 | -28 | -18 | +10 |
Ex-div: 20 Mar Payment: 18 Apr *Dividend excludes a special dividend of 70p paid on 30 November 2012 | ||||
