Windows and door fittings company Tyman (TYMN), formerly Lupus Capital, failed to complete its $200m (£129m) purchase of Truth Hardware before the end of a flat first half. That flattered the balance sheet, but the money is paid now and, with Truth on board and momentum building elsewhere, the second half should be better.
Cannaccord Genuity thinks so. However, ongoing weakness in Europe has persuaded the broker to downgrade its forecast for full-year adjusted pre-tax profit by 10 per cent to £27m, giving adjusted EPS of 12.4p (from £23m/10.4p in 2012), but rising to 16p in 2014. Tyman’s international division made £1.7m a year ago, but Germany and its export markets have struggled and the unit lost £236,000 this time. Management admits it will only break even for the full-year. That partly explains unchanged group operating profit of £10.9m before acquisition and restructuring costs, and a 12.5 per cent like-for-like decline in constant currency terms.
Still, order books are up everywhere and, after heavy investment constricted profit growth in the first half, Tyman’s North American operation Amesbury is poised to improve. Truth is also doing well, and targeted integration savings of $5m look conservative. Momentum continued to build through during the summer here, too.
TYMAN (TYMN) | ||||
|---|---|---|---|---|
| ORD PRICE: | 213p | MARKET VALUE: | £361m | |
| TOUCH: | 212-213p | 12-MONTH HIGH: | 245p | Low: 134p |
| DIVIDEND YIELD: | 2.3% | PE RATIO: | na | |
| NET ASSET VALUE: | 191p* | NET CASH: | £25.2m | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 112 | 4.59 | 2.90 | 1.00 |
| 2013 | 124 | -1.24 | -1.41 | 1.50 |
| % change | +11 | - | - | +50 |
Ex-div: 11 Sep Payment: 11 Oct *Includes intangible assets of £264m, or 156p per share | ||||
