Shares in Polypipe (PLP) rose over 5 per cent on the morning the piping and ventilation specialist revealed a resilient performance during the six months to June. Revenue was flat, while underlying operating profits and margins were lower. But this reflected delays caused by bad weather, with an estimated £8m impact on revenue, and project delays in road and other commercial projects.
However, these were offset by another strong performance in the new residential sector where, despite the poor weather in February and March, revenue was up nearly 6 per cent. And in May and June this accelerated by 8 per cent from a year earlier.
Activity in the repair, maintenance and improvement (RMI) sector remained broadly flat, partly because of weak consumer confidence but also because public spending budgets have recently been diverted to fire safety and cladding refurbishment. However, the broader picture remains positive, underpinned by continued legislation in water management and climate change, as well as replacement of older pipe systems. Polypipe also completed the sale of its low-margin French business for €16.5m (£14.7m).
Analysts at Peel Hunt are forecasting adjusted pre-tax profits for the year to December 2018 of £70m and EPS of 28.5p (from £65.7m and 26.9p in 2017).
| POLYPIPE (PLP) | ||||
| ORD PRICE: | 373.8p | MARKET VALUE: | £747m | |
| TOUCH: | 373.2-374p | 12-MONTH HIGH: | 435p | LOW: 340p |
| DIVIDEND YIELD: | 3.0% | PE RATIO: | 16 | |
| NET ASSET VALUE: | 157p* | NET DEBT: | 47% | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2017 (restated) | 210 | 30.5 | 12.3 | 3.6 |
| 2018 | 210 | 30.1 | 12.4 | 3.7 |
| % change | - | -1 | +1 | +3 |
| Ex-div: | 30 Aug | |||
| Payment: | 21 Sep | |||
| *Includes intangible assets of £354m, or 177p a share | ||||
