Having bought Midland Fuel Oil Supplies – a fuel distributor that supplies 12m litres to the south and east of Birmingham – in December, NWF (NWF) appears to be taking advantage of the highly fragmented fuels market. Broker Peel Hunt reckons the top 10 fuels players control 23 per cent of the market, with the remaining 77 per cent split between 150 companies – presenting plenty of scope for future deals. Indeed, NWF chairman Philip Acton said the deal demonstrated NWF’s "strategic ambitions".
Meanwhile, fear of a food shortage in Britain post-Brexit could work to the group's advantage. The food division already operates 96,000 pallet spaces, up from 89,000 last year, and it’s thought around 5,000 are being used to stockpile ahead of Brexit. This could provide a short-term boost to revenue, as could a potential contract with supermarket Aldi, now that a short-term trial is complete.
Analysts at Peel Hunt expect adjusted pre-tax profits of £9.1m in the year to May 2019, giving EPS of 14.9p (down from £10.2m and 16.6p in FY2018).
| NWF GROUP (NWF) | ||||
| ORD PRICE: | 173p | MARKET VALUE: | £84.2m | |
| TOUCH: | 170-175p | 12-MONTH HIGH: | 213p | LOW: 149p |
| DIVIDEND YIELD: | 3.7% | PE RATIO: | 11 | |
| NET ASSET VALUE: | 96p* | NET DEBT: | 32% | |
| Half-year to 30 Nov | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2017 | 296 | 1.90 | 3.10 | 1.0 |
| 2018 | 331 | 1.90 | 2.80 | 1.0 |
| % change | +12 | - | -10 | - |
| Ex-div: | 21 Mar | |||
| Payment: | 01 May | |||
| *Includes intangible assets of £22.1m or 45p per share | ||||
