5 December 2016 – interim results
The niche plastics products group has announced interim results for the six month period to 30 September which have revealed a 13% increase in revenues to £27.8m (2015: £24.5m), whilst adjusted pre-tax profits were 7% ahead at £1.64m (2015: £ 1.53m). Earnings per share on the same basis were also 7% higher at 4.3p (2015: 4.0p) whilst the interim dividend was maintained at 1.46p. These were solid results with the recent acquisition of Synpac making a good initial contribution. This acquisition was one factor which led to net debt rising to £15.1m at the end of the period compared with £10.9m at the end of March. The board has decided to try and retain more cash in the business for re-investment hence the fact the dividend was only maintained whilst it also is considering further acquisitions. Although order books are healthy and the outlook for the second half is encouraging, the performance of the shares has been relatively pedestrian and we reduce our recommendation to HOLD.