Safety harness specialist Latchways (LTC) has reported record sales and profits, buoyed by orders from the aerospace industry and overseas which underpinned a sharp second-half recovery. Revenues jumped by a third on the first half and were up by a quarter on the second half of last year. Reported profits benefited from one-off gains, but strip these out and pre-tax profit improved 3.3 per cent to £10.3m.
The Safety Products division - responsible for three-quarters of Latchways turnover - was key to the improved performance. Revenues here increased 7 per cent, having been down 10 per cent at the half-year stage. Demand from Airbus and British Airways for the Wingrip product lifted UK sales by 14 per cent to £12.5m and offset ongoing weakness in UK construction.
In the US, after a weak first half, the new Personal Rescue Device (PRD) helped lift sales there by 7 per cent and a recently signed deal with 3M, a harness manufacturer, is expected to give a significant boost to orders in the region. PRD accounted for £1.2m of Latchways annual sales. And the rest of the world segment posted double-digit revenue growth, mainly reflecting orders from Australia and New Zealand.
Assisted by new distribution agreements for the PRD and Self Retracting Lifelines, house broker N+1 Singer expects adjusted pre-tax profits to rise 10 per cent to £11.2m, giving EPS of 73.1p (from 70.3p previously).
LATCHWAYS (LTC) | ||||
|---|---|---|---|---|
| ORD PRICE: | 1,045p | MARKET VALUE: | £117m | |
| TOUCH: | 1,030-1,060p | 12-MONTH HIGH: | 1,097p | LOW: 935p |
| DIVIDEND YIELD: | 3.4% | PE RATIO: | 15 | |
| NET ASSET VALUE: | 292p* | NET CASH: | £10.5m | |
| Year to 31 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2009 | 37.0 | 8.31 | 51.6 | 23.4 |
| 2010 | 33.9 | 7.62 | 49.3 | 25.8 |
| 2011 | 39.6 | 9.33 | 61.3 | 29.6 |
| 2012** | 41.4 | 9.93 | 66.0 | 32.7 |
| 2013 | 42.4 | 10.94 | 74.5 | 36.0 |
| % change | +2 | +10 | +13 | +10 |
Ex-div: 14 Aug Payment: 13 Sep *Includes intangible assets £6.44m, or 57p a share **Excludes a special dividend of 40p a share | ||||
