Christmas cracker and gift-wrap maker International Greetings (IGR) reported a solid start to the year, and chief executive Paul Fineman says the company is on track to hit full-year targets. So it was surprising to see the shares slump 5 per cent on the back of the results.
Revenues did fall slightly, but underlying sales were flat, as many global retailers placed their orders later in the year; the top-line will be more weighted to the second half this year. More encouragingly, adjusted pre-tax profit rose 7 per cent to £4m, as investment in manufacturing efficiency in China, the UK and Europe, coupled with cost savings, paid off handsomely. IGR also made an acquisition in the period: Dutch-based giftwrapper Enper.
Christmas trading has gone well, with volumes of gift wrap and crackers at record levels. The order book for the full year is as expected, and already building for 2015-16. Mr Fineman also says the group is on track to cut debt, which will pave way for a return to the dividend list. The only major disappointment was the joint venture in Australia, which is still recovering from the bankruptcy of a major customer.
Broker Cenkos expects adjusted pre-tax profit of £8.3m for the full year, giving EPS of 9p, up from £7.6m and 8p.
| INTERNATIONAL GREETINGS (IGR) | ||||
|---|---|---|---|---|
| ORD PRICE: | 71p | MARKET VALUE: | £41.1m | |
| TOUCH: | 69-72p | 12-MONTH HIGH: | 87p | LOW: 59p |
| DIVIDEND YIELD: | nil | PE RATIO: | 10 | |
| NET ASSET VALUE: | 96p* | NET DEBT: | 154% | |
| Half-year to 30 Sep | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 114 | 1.7 | 1.4 | nil |
| 2014 | 112 | 3.0 | 3.5 | nil |
| % change | -1 | +72 | +150 | - |
Ex-div: na Payment: na *Includes intangible assets of £32.1m or 56p a share | ||||
