Underlying pre-tax profits at Fenner (FENR) came in 4 per cent ahead of analysts’ expectations for the August 2017 year-end, rising 95 per cent on the year before, as the group cemented a clear recovery following a difficult few years. The polymer specialist also struck an optimistic tone when discussing current-year prospects, prompting analysts at N+1 Singer to consider upgrading current-year forecasts. Prior to these numbers, the broker expected pre-tax profits of £51m for the year ending August 2018, giving EPS of 18p, up from £45.3m and 17.7p in FY2017.
The advanced engineering products (AEP) division reported an 11 per cent increase in revenues to £294m, which helped drive a 29 per rise in underling operating profits. But this paled in comparison to progress at the engineered conveyance solutions (ECS) business, where operating profits increased by 46 per cent on the back of improved operating margins – achieved despite higher raw material prices and lower revenues.
Chief executive Mark Abrahams said the considerable improvement in free cash flow and reduction in net debt to a much more manageable 1.2 times cash profits also means the board is ready to start considering acquisitions again.
| FENNER (FENR) | ||||
| ORD PRICE: | 360p | MARKET VALUE: | £ 698m | |
| TOUCH: | 359-360p | 12-MONTH HIGH: | 372p | LOW: 228p |
| DIVIDEND YIELD: | 1.2% | PE RATIO: | 20 | |
| NET ASSET VALUE: | 176p* | NET DEBT: | 30% | |
| Year to 31 Aug | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2013 | 821 | 66.4 | 22.9 | 11.3 |
| 2014 | 729 | 29.2 | 11.7 | 12.0 |
| 2015 | 667 | -5.3 | -5.4 | 12.0 |
| 2016 | 573 | -30.3 | -13.6 | 3.0 |
| 2017 | 655 | 38.1 | 17.6 | 4.2 |
| % change | +14 | - | - | +40 |
| Ex-div: | 25 Jan | |||
| Payment: | 08 Mar | |||
| *Includes intangible assets of £175m or 90p a share | ||||
