Somero Enterprises (SOM) had already disclosed that four of its six geographies enjoyed growth during the half year to June – up from three geographies 12 months earlier. But the official interim numbers helped flesh out the details – revealing particularly strong contributions from the high-tech, concrete-levelling specialist’s dominant regions: North America and Europe.
Indeed, these grew by 7 per cent to $30.5m (£23.7m) and 24 per cent to $6.7m respectively. North America’s momentum was underpinned by strong sales of boomed screeds and ride-on screeds. Optimism about this market isn’t without foundation: non-residential construction activity was solid, and customers’ project backlogs "extend well into 2019". Meanwhile, Somero sold equipment across 14 European countries, with the UK, Germany and France among the top contributors.
Sales in China fell 7.4 per cent to $2.5m, following a 14 per cent dip here at the full-year stage. But the group has launched sales and marketing initiatives there and employed a China national sales director.
The shares’ decent mark-up on results day was no doubt supported by a doubling in Somero’s dividend. While this might reflect management's confidence in the future strategy, it also stems from the decision to pay out a greater proportion of the full-year dividend at the interim stage, entailing a one-off rebasing.
Broker FinnCap forecasts adjusted pre-tax profits of $27.7m and EPS of 37.7¢ for 2018 ($26.2m and 36.5¢ in 2017).
| SOMERO (SOM) | ||||
| ORD PRICE: | 413p | MARKET VALUE: | £232m | |
| TOUCH: | 405-420p | 12-MONTH HIGH: | 423p | LOW: 259p |
| DIVIDEND YIELD*: | 3.4% | PE RATIO: | 15 | |
| NET ASSET VALUE: | 87¢ | NET CASH: | $20.7m | |
| Half-year to 30 Jun | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
| 2017 | 42.4 | 12.0 | 17.0 | 2.75 |
| 2018 | 45.0 | 13.6 | 19.0 | 5.50 |
| % change | +6 | +14 | +12 | +100 |
| Ex-div: | 27 Sep | |||
| Payment: | 17 Oct | |||
| *Excludes special dvidends of 3.6¢ and 13.3¢, paid 20 Apr 2018 and 14 Aug 2017 respectively. £1 = $1.28 | ||||
