13 June 2017 – interim results
The specialist engineering group has announced its interim results for the six months to 1 April which have shown improving momentum across the group. Revenue for the period on continuing operations increased to £17.7m (2016: £16.2m) and a pre-tax loss of £0.85m (2016: loss of £0.95m) was recorded. Although it is disappointing that the group remains loss-making there are signs that the group is now firmly on the recovery path helped by the £6m of annual cost savings that have been made since 2015. The Precision Machined Components business is now benefitting from significant restructuring in recent years whilst the Cylinders business has also established a strong order book in the defence sector with the business in the oil and gas sector also set to improve. Although net debt has increased to £8.6m (2016: £6.1m) this was due to the acquisition of Martract Limited in December which saw a cash outflow of £3.6m. The integration of this business is on track and it is contributing as expected. An improvement in trading is expected in the second half with full year revenues expected to be £49.6m and adjusted pre-tax profits of £1.6m are forecast. Earnings per share on the same basis would be 9.1p but further significant growth is forecast for the following year when earnings per share could rise to 23.5p. The shares are GOOD VALUE.