This was a solid set of figures from TT Electronics (TTG), with operating profit up 12 per cent to £24.3m at constant currencies, buoyed by a 60 basis point increase in the underlying margin. The balance sheet looks in better nick following the November sale of its transportation sensing & control unit for £123m, reversing a net debt position to net cash of £47m, while the defined-benefit pension schemes moved into a net accounting surplus of £11.9m, against a deficit of £5.7m in 2016.
Improved capital discipline resulted in a cash conversion rate of 98 per cent, while free cash flow stood at £4.7m, a fall-away from 2016, reflecting a £6.2m outflow for share purchases in the employee benefit trust.
The group's order book has improved partly because of customers placing longer lead-times on orders, with encouraging levels of activity in the sensors and specialist components and power electronics division. Management flagged increased investment in R&D, highlighting a total of 16 new products launched through the year.
New business wins and sales to existing customers provide cause for encouragement, along with a multi-year contract with an aerospace and defence OEM customer in the US for printed circuit board assembly, while TT continued to develop its strategic supplier relationship with Rolls-Royce (RR.) for power and control microcircuits.
| TT ELECTRONICS (TTG) | ||||
| ORD PRICE: | 225p | MARKET VALUE: | £367m | |
| TOUCH: | 225-229p | 12-MONTH HIGH: | 245p | LOW: 157p |
| DIVIDEND YIELD: | 2.6% | PE RATIO: | 23 | |
| NET ASSET VALUE: | 164p* | NET CASH: | £47m | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2013 | 532 | 18.3 | 8.8 | 5.4 |
| 2014 | 524 | -5.9 | -6.6 | 5.5 |
| 2015 | 510 | 13.8 | 6.5 | 5.5 |
| 2016 | 333 | 14.3 | 7.3 | 5.6 |
| 2017 | 360 | 17.7 | 9.7 | 5.8 |
| % change | +8 | +24 | +33 | +4 |
| Ex-div: | 26 Apr | |||
| Payment: | 18 May | |||
| *Includes intangible assets of £128m, or 78p a share | ||||
