A trio of huge gasification projects flattered Porvair’s (PRV) half-year numbers, but even without them the top-line is growing quickly. In fact, the filter manufacturer’s biggest problem is coping with demand, which explains why management is spending £6m on extra factory space and machinery this year. Modest upgrades by Peel Hunt “leave the potential for more later in the year,” explains the broker.
Strip out the long-term contracts and revenue jumped by 8 per cent - or 12 per cent at constant currency. Peel Hunt now expects full-year adjusted pre-tax profit of £8.7m, giving adjusted EPS of 13.9p (up from £7.8m and 12.5p last year).
There was double-digit underlying growth at the microfiltration division - the less cyclical business that services those big contracts. Demand for coolant filters on the Airbus A380 and Boeing 787 helped generate record results for the aerospace unit, in particular. Top-line growth of 29 per cent made for a strong start to the year for water analyser Seal Analytical, too.
Meanwhile, the more cyclical metals filtration division clocked profit growth of 8 per cent. New carbon foam filters used for magnesium are beginning to chip in alongside Porvair’s more established products for aluminium, alloys and iron.
PORVAIR (PRV) | ||||
|---|---|---|---|---|
| ORD PRICE: | 316p | MARKET VALUE: | £ 140m | |
| TOUCH: | 312-316p | 12-MONTH HIGH: | 345p | Low: 220p |
| DIVIDEND YIELD: | 0.9% | PE RATIO: | 23 | |
| NET ASSET VALUE: | 111p* | NET DEBT: | 2% | |
| Half-year to 31 May | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 38.6 | 3.0 | 4.8 | 1.1 |
| 2014 | 51.0 | 3.8 | 6.0 | 1.2 |
| % change | +32 | +27 | +25 | +9 |
Ex-div:30 Jul Payment:05 Sep *Includes intangible assets of £42m, or 94p per share | ||||
