Robinson – Interims please, shares at 155p, brokers increased Target Price to 170p, still looking undervalued

21.08.2025

This morning’s announcement of the Interim Results for the six months to end-June by the Chesterfield-based Robinson (LON:RBN) group should be quite positive for the group’s shares, now 155p.

In the first-half, on revenues up just 2% to £27.6m (£27.1m), the group reported that its gross margin was 1% higher at 22%, while its underlying operating profit was 25% higher at £2.0m (£1.6m).

The declared pre-tax profit was up 257% at £1.8m (£0.7m).

The Business

The company, which has a substantial property portfolio with development potential, can trace its roots back over 185 years, it specialises in custom packaging with technical and value-added solutions for food and consumer product hygiene, safety, protection, and convenience.

Its main activity is in injection and blow-moulded plastic packaging and rigid paperboard luxury packaging, operating within the food and beverage, homecare, personal care and beauty, and luxury gift sectors.

Robinson provides products and services to major players in the fast-moving consumer goods market including Procter & Gamble, Reckitt Benckiser, SC Johnson and Unilever.

Management Comment

Upon this morning’s Interims, Chairman Alan Raleigh stated that:

"The results for the first half of 2025 continue to build on the excellent progress made in 2024.

Whilst market conditions remain challenging and we continue to experience softness and volatility in demand from some existing customers, we also continue to see new opportunities in our sales pipeline which we expect to see the benefit of in future periods.

We are delivering on our surplus property disposal agenda, which will reduce indebtedness and create a simpler more streamlined business.

We continue to refresh our strategy to identify opportunities and the necessary capabilities for further growth in revenue and profits.

The Company expects underlying operating profit for the 2025 financial year to be ahead of 2024 and in line with current market expectations.

We remain committed in the medium-term to delivering above-market profitable growth and our target of 6-8% underlying operating margin."

Reducing Borrowings

Earlier this month the plastic and paperboard packaging group announced that it has agreed the sale of four of its surplus properties, with the cash proceeds being used to reduce bank debt.

The intention of the £26m-capitalised group remains, over time, to realise value from the disposal of surplus properties and use the proceeds to reduce indebtedness and develop its packaging business.

Broker’s View

Analyst Ed Stacey, at Cavendish Capital Markets, who has now upped his Target Price on the group’s shares to 170p from 155p previously, is now estimating that current year sales to end-December will be £56.4m (£56.4m), while its adjusted pre-tax profits could be £2.7m (£2.4m), lifting earnings up to 12.5p (9.6p), more than double covering a maintained 6.0p a share dividend.

For 2026 he looks for £58.9m sales, £3.2m profits, 14.6p earnings and that maintained 6.0p dividend.

My View

Two weeks ago, when I last featured this group upon its planned property disposals, its shares were standing at 130p.

They are now 155p, after hitting 159.85p a couple of days ago.

I believe that the Cavendish Capital Markets Target Price of 170p will be easily achieved within this year.

(Profile 02.04.2020 @ 55.50p set a Target Price of 80p*)

(Profile 31.01.2025 @ 117.50p set a Target Price of 140p*)