Cohort (CHRT) has agreed to buy German naval sonar systems business ELAC for €11.25m (£9.5m), in a deal that will complete on or before 30 June 2020, subject to approval from the German government.
ELAC will become Cohort’s sixth subsidiary and is viewed as complementary to the holding company’s electronic systems outfit SEA, which made a small loss over the group’s half-year. Falling SEA revenues and investment in its anti-submarine warfare system, which included a sea trial with the Portuguese Navy, brought about a £0.3m trading loss compared with £0.4m profit in 2018. Management expects SEA to return to profit in its second half and perform similarly to last year.
Cohort’s December 2018 acquisition Chess Technologies, which used its counter drone technologies to help end last year’s Gatwick Airport crisis, made its first contribution to Cohort interim figures, accounting for £13.9m of group turnover. Cohort’s order book jumped to £207m from £191m, a record for the group. Around £60m of the order backlog is deliverable in the second half, which, added to revenue delivered to date, amounts to 83 per cent of forecast full-year revenue, which is up from 71 per cent at the 2018 half-year.
Broker Investec forecasts adjusted pre-tax profits and EPS of £19m and 36p, respectively, for the April 2020 year-end, rising to £21m and 40.8p in FY2021.
| COHORT (CHRT) | ||||
| ORD PRICE: | 615p | MARKET VALUE: | £ 252m | |
| TOUCH: | 610-620p | 12-MONTH HIGH: | 620p | LOW: 354p |
| DIVIDEND YIELD: | 1.5% | PE RATIO: | 34 | |
| NET ASSET VALUE: | 166p* | NET DEBT: | 9%** | |
| Half-year to 31 Oct | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2018 | 39.5 | -1.96 | -3.52 | 2.85 |
| 2019 | 60.2 | -0.003 | 1.00 | 3.20 |
| % change | +52 | - | - | +12 |
| Ex-div: | 30 Jan | |||
| Payment: | 26 Feb | |||
| *Includes intangible assets of £59.2m, or 144p a share. **Excludes lease liabilities of £5.8m | ||||
