A stronger second half made up for a much tougher first half for wood-based sheet materials importer James Latham (LTHM). Even so, gross margins for the year to March 2018 were still down from 18.2 per cent in the previous year to 17.6 per cent, the second year in a row that margins have declined.
Sterling weakness and an increase in manufacturers’ prices accounted for the reduction, while selling and distribution costs were up by 5.3 per cent. Overhead expenses were also higher, but that included the cost of relocating its Yate and Leicester sites. Both sites have performed well after relocation, notably in added-value products where a new racking system has allowed a widening of the stock range.
Pre-tax profit was up £1.4m, but this included a £1.3m profit from the sale of the company's Wigston site. However, a lower tax charge meant that after-tax profit rose from £11m to £12.6m. Trading in the new financial year has started well, with sales per working day up 9.8 per cent in April and May.
To meet the pension fund deficit, the company has agreed to contribute £2m a year until the year ending March 2024. However, the deficit halved to £8.4m because of changes in the discount rate.
| JAMES LATHAM (LTHM) | ||||
| ORD PRICE: | 707.5p | MARKET VALUE: | £139m | |
| TOUCH: | 685-730p | 12-MONTH HIGH: | 958p | LOW: 623p |
| DIVIDEND YIELD: | 2.3% | PE RATIO: | 11 | |
| NET ASSET VALUE: | 456p | NET CASH: | £13m | |
| Year to 31 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2014 | 163 | 10.5 | 44.3 | 11.4 |
| 2015 | 175 | 10.1 | 40.3 | 12.5 |
| 2016 | 186 | 12.9 | 53.7 | 14.3 |
| 2017 | 199 | 13.8 | 56.0 | 15.4 |
| 2018 | 215 | 15.2 | 64.4 | 16.6 |
| % change | +8 | +10 | +15 | +8 |
| Ex-div: | 2 Aug | |||
| Payment: | 24 Aug |
