RPC Group (RPC) grabbed headlines last month when it spent over £250m on ACE Corp, the Chinese plastic packaging and parts manufacturer. But sales of shampoo bottles, pill pots, coffee capsules and tubs of sealed food have sold well over the past year too, which partly explains why these results smashed forecasts. The current financial year has started in much the same vein.
An 11 per cent jump in adjusted operating profit to £101m beat broker Panmure Gordon's forecasts by 5 per cent. Admittedly, last year's acquisition of M&H Plastics - which boosted UK margins - and Helioplast added £3.5m of profit, and a small change in depreciation policy chipped in another £3.7m. Yet there were £7m of annual cost savings too - a figure management says should reach £17m within three years.
Panmure nudged its estimates higher and now expects adjusted pre-tax profit of £114m this year, with growth in adjusted EPS of 12 per cent to 45.9p (from £89.5m and 41.4p in 2013-14), followed by 7 per cent for each of the next two years. That includes ACE, but customers on both sides like the deal, and the benefits could be substantial. More earnings-enhancing acquisitions, either in Europe or elsewhere, look likely.
RPC (RPC) | ||||
|---|---|---|---|---|
| ORD PRICE: | 655p | MARKET VALUE: | £1.2bn | |
| TOUCH: | 651-655p | 12-MONTH HIGH: | 662p | LOW: 391p |
| DIVIDEND YIELD: | 2.4% | PE RATIO: | 25 | |
| NET ASSET VALUE | 152p* | NET DEBT: | 98% | |
| Year to 31 Mar | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2010 | 0.72 | 19.2 | 10.7 | 8.38 |
| 2011 | 0.82 | 34.6 | 19.5 | 11.5 |
| 2012 | 1.13 | 59.6 | 27.7 | 14.4 |
| 2013 | 0.98 | 48.2 | 20.6 | 14.9 |
| 2014 | 1.05 | 59.0 | 26.5 | 15.5 |
| % change | +7 | +22 | +29 | +4 |
Ex-div: 6 Aug Payment: 5 Sep *Includes intangible assets of £180m, or 101p a share | ||||
