As a provider of premium-branded broadcast and photographic equipment, Vitec (VTC) was, perhaps, an inevitable corporate victim of the coronavirus outbreak. While the group does not own any manufacturing sites in China, it has 25 suppliers of finished goods in the country which supply products pertaining to about a quarter of group revenues. Another quarter of group revenues comes from products made in northern Italy – where there has recently been a spike in the number of reported infections. It follows that, for now, Vitec estimates a total dampener of £3m-£5m on operating profits for the first half and 2020 full-year.
In any case, the group cited a “robust” performance for 2019, despite the non-recurrence of the Winter Olympics. As forewarned in November, two one-off events knocked the numbers; Vitec endured severe retailer de-stocking within its imaging solutions business, and there was also a slower-than-expected recovery within its SmallHD arm following a fire in 2018. Still, adjusted pre-tax profits landed at £48m – within management’s (lowered) guidance range of £47m-£50m, albeit down from £51.2m in 2018.
Peel Hunt now expects adjusted pre-tax profits of £46.7m and EPS of 76.1p for 2020, down from earlier estimates of £51.7m and 84.3p.
| VITEC (VTC) | ||||
| ORD PRICE: | 850p | MARKET VALUE: | £ 388m | |
| TOUCH: | 822-850p | 12-MONTH HIGH: | 1,335p | LOW: 780p |
| DIVIDEND YIELD: | 4.6% | PE RATIO: | 19 | |
| NET ASSET VALUE: | 344p* | NET DEBT: | 73%** | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2015 | 318 | 18.5 | 29.3 | 24.0 |
| 2016 | 319 | 26.4 | 55.9 | 27.2 |
| 2017 | 353 | 27.4 | 23.4 | 30.5 |
| 2018 | 385 | 37.9 | 76.1 | 37.0 |
| 2019 | 376 | 27.6 | 44.9 | 39.0 |
| % change | -2 | -27 | -41 | +5 |
| Ex-div: | 23 Apr | |||
| Payment: | 29 May | |||
*Includes intangible assets of £127m or 280p a share **Includes £18.2m in lease liabilities | ||||
