The vertiginous rise in the value of Scapa (SCPA) shares continued this week with the adhesive products manufacturer's publication of full-year results. A round of earnings upgrades and a currency-aided 13 per cent jump in annual revenues helped push the shares up 5 per cent on results day - or on a longer horizon, a 50-fold return since the shares bottomed out during the financial crisis in March 2009.
So what went right again this time around? The group's "relentless and uncompromising execution" of its strategy - chief executive Heejae Chae's words - contributed to higher profitability at the industrial division, where margins increased by 340 basis points to 10.4 per cent. The reach of the healthcare business was also in focus, as the contribution of Euromed conspired with sterling's weakness to boost the division's top line by 16.5 per cent and over the £100m mark. Short of that assistance, underlying revenue would have actually dropped 4.6 per cent at constant currencies, compared to 2016's strong outing.
Arden Partners upgraded its numbers following these results, and now expects adjusted pre-tax profits of £31m and EPS of 16.2p for the year to March 2018, against £28m and 14.8p in 2017.
SCAPA (SCPA) | ||||
|---|---|---|---|---|
| ORD PRICE: | 452p | MARKET VALUE: | £689m | |
| TOUCH: | 452-453p | 12-MONTH HIGH: | 458p | LOW: 225p |
| DIVIDEND YIELD: | 0.4% | PE RATIO: | 39 | |
| NET ASSET VALUE: | 66p* | NET DEBT: | 16% | |
| Year to 31 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 209 | 9.6 | 0.8 | 0.50 |
| 2014 | 226 | 11.2 | -4.6 | 1.00 |
| 2015 | 236 | 13.7 | 6.5 | 1.50 |
| 2016 | 247 | 9.8 | 4.1 | 1.75 |
| 2017 | 280 | 21.8 | 11.6 | 2.00 |
| % change | +13 | +122 | +183 | +14 |
Ex-div: 20 Jul Payment: 18 Aug *Includes intangible assets of £63m, or 41p a share. | ||||
