An 8.1 per cent jump in the top line at McColl’s (MCLS) masked a 1.4 per cent slump in like-for-like sales after the collapse of wholesaler Palmer & Harvey led to significant supply chain disruption last year. The group did its best to offset the chaos, including accelerating its new supply agreement with supermarket chain Morrisons (MRW). In less than nine months – and three months ahead of schedule – the group managed to get 1,300 of its stores onto the new Morrisons scheme – something chief executive Jonathan Miller called “a considerable achievement”. Even so, operating profits before adjustments fell from £31.4m to £18.3m.
As for the new financial year, sales momentum has improved, with total like-for-like sales for the 11-week period ended 10 February 2019 up 1.2 per cent. The group has also made changes to its banking facilities, including increasing the financial headroom on its covenants. Net debt also fell from £142m to £98.6m to represent 2.8 times adjusted cash profits.
Analysts at Numis expect pre-tax profits of £10.5m for the year ending November 2019, giving EPS of 7.3p (£10m and 6.4p in FY2018).
| MCCOLL'S RETAIL (MCLS) | ||||
| ORD PRICE: | 57p | MARKET VALUE: | £66m | |
| TOUCH: | 56-57p | 12-MONTH HIGH: | 260p | LOW: 49p |
| DIVIDEND YIELD: | 7.0% | PE RATIO: | 10 | |
| NET ASSET VALUE: | * | NET DEBT: | £98.6m | |
| Year to 25 Nov | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2014 | 0.92 | 12.6 | 10.2 | 8.5 |
| 2015 | 0.93 | 21.1 | 15.4 | 10.2 |
| 2016 | 0.95 | 17.7 | 12.8 | 10.2 |
| 2017 | 1.15 | 18.4 | 12.3 | 10.3 |
| 2018 | 1.24 | 7.9 | 6.0 | 4.0 |
| % change | +8 | -57 | -52 | -61 |
| Ex-div: | 25 Apr | |||
| Payment: | 06 Jun | |||
| *Negative shareholder funds – balance sheet includes £253m of intangible assets, or 219p a share | ||||
