Yesterday’s Interim Results from this owner, designer, manufacturer and ‘omnichannel’ retailer of leading homeware brands in global markets, were much in line with expectations.
The six months to end-June saw revenues lower at £36.6m (£44.1m) and with its headline pre-tax loss of £2.0m (£0.0m), but with net debt reduced to £13.4m (£15.0m).
Cost restructuring is on track to deliver £4m lower overheads supporting the group’s commitment to growing operating margins in the short and long term.
Despite its markets remaining challenging and unpredictable, the group has strong order books for Christmas, ahead of the same period last year.
CEO Mike Raybould stated that:
"We are pleased with the sales and gross margin growth in the US, our largest sales market.
We have added new distribution in the US in the last 6 months and are confident that as the macroeconomics improve that we will see the benefit in our top line sales.
Similarly, we continue to take market share in the UK Grocery channel with our new Wax Lyrical home fragrance ranges and with further new major listings since the half year, our factory in Cumbria continues to successfully ramp up production levels and efficiency.
As previously indicated, the Group has seen reduced order flow in H1 2024 from our South Korean market as high levels of stock take time to sell through.
However, we are encouraged that our brands continue to be in high demand in this market as evidenced by growing online sales and that our Botanic Garden tableware range remains in the top two for all online brand searches.
Furthermore, we are accelerating new product launches to help support this market in the short term.
Our brands continue to resonate globally and with a healthy Christmas order book, we are currently trading in line with board expectations and are on track to meet Full Year market expectations."
Analysts Sahill Shan at Singer Capital Markets and Rob Sanders at Shore Capital Markets have current-year estimates of £100.00m sales (£102.7m) and adjusted pre-tax profits of £4.5m (£3.0m), with earnings ranging from 24.5p to 25.1p per share.
Both brokers see sales of around £105.3m next year, with about £7.1m profits, worth about 39p per share in earnings, and a 12p dividend.
As I see it the shares, now 218p, will show a cracking uplift in value over the next year.
I am also confident about my most recent Target Price of 295p being achieved.
(Profile 28.08.20 @ 376p set a Target Price of 480p*)
(Profile 20.10.23 @ 240p set a Target Price of 300p*)
(Profile 22.07.24 @ 235p set a Target Price of 295p)
Comentarios