Soft drinks group Nichols (NICL) reported single-digit growth at every level of its income statement for the first half, with the relatively muted return stemming from mixed trading across its core geographies. The UK enjoyed 13.2 per cent revenue growth to £53.8m over the six months – buoyed by its Vimto drink continuing to outperform the market. In the year to date, sales of Vimto were up 9 per cent against a 3.7 per cent increase for the UK soft drink market as a whole. Encouragingly, the UK’s out-of-home revenue rose 13.6 per cent.
International revenue fell 30 per cent year on year to £11.2m, although this was in keeping with bosses’ expectations. As had been indicated at the full-year results stage, Middle Eastern sales were lower due to the continuing conflict in Yemen and the timing of shipments to Saudi Arabia. Sales to Africa fell by 3.7 per cent to £6.8m. But management expects to report annual growth in the region, with a greater second-half weighting, buoyed by its planned launch in Kenya in September. Indeed, overall, the group is confident about meeting full-year expectations – a conviction supported by its decision to hike the half-year dividend by 11.9 per cent.
Broker Numis forecasts adjusted pre-tax profit of £31m and EPS of 68.9p for 2018 (from £30.5m and 67.8p in 2017).
| NICHOLS (NICL) | ||||
| ORD PRICE: | 1,500p | MARKET VALUE: | £554m | |
| TOUCH: | 1,490-1,500p | 12-MONTH HIGH: | 1,940p | LOW: 1,386p |
| DIVIDEND YIELD: | 2.3% | PE RATIO: | 23 | |
| NET ASSET VALUE: | 275p* | NET CASH: | £37.1m | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2017 | 63.5 | 12.7 | 27.7 | 10.1 |
| 2018 | 65.0 | 13.1 | 28.8 | 11.3 |
| % change | +2 | +3 | +4 | +12 |
| Ex-div: | 26 Jul | |||
| Payment: | 31 Aug | |||
| *Includes intangible assets of £41.5m, or 112p a share | ||||
