14 April 2015 – final results
After the mixed trading update released in February, the group has released annual results for 2014 which are much in line with expectations. Revenue for the year rose by 19% to £44.9m, whilst pre-tax profits before exceptional items were over 16% higher at £7.0m. Earnings per share on the same basis were 13% higher at 32.5p and the dividend was increased by 5% to 6.2p. Following the share placing last September which raised £3.4m, gearing at the year end was a relatively modest 32%. Although these results are very pleasing, the decline in the oil price, which had little impact on these figures, seems likely to have more of an effect in 2015. Current volumes and margins in the oil tool rental business are lower than last year and the group expects its first half figures to be lower than last year. Although long term prospects remain solid the uncertainty created by the oil price seems likely to cause the shares to drift and so we maintain our recommendation of HOLD.