Aim 100 

The Aim 100 2019: 70 to 61

The Aim 100 2019: 70 to 61

70. Camellia

When looking for an example of a diversified business model, one might look towards Camellia (CAM), which has agriculture, engineering and food service operations. The idea is that trouble in one can be offset by the performance from the others. And trouble may be brewing in the agriculture division, as exceptionally high volumes have suppressed auction prices in some key markets, prompting analysts at Panmure Gordon to downgrade pre-tax profit forecasts by 36 per cent to around £23m based on “lower margin” assumptions.

This may be concerning, considering that the agriculture business is where the bulk of group profits are generated. Encouragingly, the UK engineering business reduced its trading losses to £0.6m after it divested three of its businesses and bought Black Gold Oil Tools during the year. Camellia also has a healthy balance sheet, with around £110m of net cash to help it withstand any shocks. Still, with agriculture generating around 80 per cent of revenues, we’re wary of weakness to come in tea. Hold. JF

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