For the past few years, Vitec (VTC) has been exploring ways to capitalise on the global obsession with capturing and sharing images. Chief executive Stephen Bird believes the supplier of high-end equipment and services to broadcast and digital image markets may finally have “cracked the code”.
Strip out £15m of acquisition costs, and pre-tax profit surged 13 per cent to £42m. That’s not too shabby considering that Vitec’s second biggest division, production solutions, was hampered by a non-repeat of the 2016 summer Olympic Games and key broadcast customers in the US spending more on transmissions, rather than studios.
Making up for that shortfall was Vitec’s core imaging solutions unit. Higher video and photo support sales, greater production efficiencies and a larger proportion of high-margin e-commerce orders saw divisional adjusted operating profit grow 10.4 per cent, or 19 per cent to £30m, when excluding currency movements and factoring in the acquisition of popular photography gear brands JOBY and Lowepro. The smaller creative solutions unit also made decent progress, posting a 31 per cent rise in adjusted operating profit at constant currencies.
Broker Peel Hunt expects adjusted pre-tax profit of £47.9m for 2018, giving EPS of 78.3p, up from £39.8m and 65.1p in 2017.
| VITEC (VTC) | ||||
| ORD PRICE: | 1,120p | MARKET VALUE: | £504m | |
| TOUCH: | 1,100-1,120p | 12-MONTH HIGH: | 1,120p | LOW: 698p |
| DIVIDEND YIELD: | 2.7% | PE RATIO: | 48 | |
| NET ASSET VALUE: | 301p* | NET DEBT: | 32% | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2013 | 315 | 20.4 | 31.9 | 23.0 |
| 2014 | 310 | 20.1 | 29.4 | 24.0 |
| 2015 | 318 | 18.5 | 29.3 | 24.6 |
| 2016 | 319 | 26.4 | 55.9 | 27.2 |
| 2017 | 353 | 27.4 | 23.4 | 30.5 |
| % change | +11 | +4 | -58 | +12 |
| Ex-div: | 19 Apr | |||
| Payment: | 18 May | |||
| *Includes intangible assets of £88.4m, or 196p a share | ||||
