Defence technology group Cohort (CHRT) saw its adjusted operating profit jump by 12 per cent to a record £18m in the year to 30 April, despite a £1m hit from Covid-19. It benefitted from the first full year contribution from Chess Technologies, the electro-optical and electro-mechanical systems supplier purchased in 2018. Boosted by strong export demand for naval systems, Chess more than doubled its profits to £3.9m.
The pandemic hit in the group’s traditionally busiest quarter, with the impact most keenly felt at engineering business SEA. Export orders for naval defence products such as torpedo launcher systems were delayed, a trend that has continued into the new financial year. The division’s cost base is now being trimmed by £1.3m.
Cohort is set to acquire German naval sonar business ELAC for €11.3m (£9.8m) by the end of September. The purchase will widen its footprint in the naval market and provide cross-selling opportunities with SEA.
Even with that outlay, it expects net debt will be in line with last year, when (excluding lease liabilities) it came down by 27 per cent to £4.7m. This was aided by the UK Ministry of Defence (MoD), accelerating payments to support suppliers during the pandemic.
House broker Investec anticipates adjusted pre-tax profit of £17.6m and EPS of 22.5p in 2021, versus £17.5m and 36.7p in 2020.
COHORT (CHRT) | ||||
ORD PRICE: | 571p | MARKET VALUE: | £ 234m | |
TOUCH: | 555-587p | 12-MONTH HIGH: | 738p | LOW: 420p |
DIVIDEND YIELD: | 1.8% | PE RATIO: | 24 | |
NET ASSET VALUE: | 184p* | NET DEBT: | 15%** |
Year to 30 Apr | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
2016 | 113 | 5.3 | 19.1 | 6.0 |
2017 | 113 | 1.0 | 9.1 | 7.1 |
2018 | 110 | 10.2 | 19.0 | 8.2 |
2019 | 121 | 5.7 | 13.4 | 9.1 |
2020 | 131 | 10.0 | 23.5 | 10.1 |
% change | +8 | +75 | +75 | +11 |
Ex-div: | 13 Aug | |||
Payment: | 18 Sep | |||
*Includes £55m in intangible assets or 135p a share, **Includes £7.5m in lease liabilities |