21st May 2019 08:36
LONDON (Alliance News) - FTSE 250-listed engineering firm Electrocomponents PLC boosted its dividend Tuesday after annual profit improved, though revenue growth has slowed since the start of the new year.
For the financial year that ended in March, pretax profit widened 16% to GBP195.2 million from the GBP168.6 million the year prior. This was after revenue rose 9.9% to GBP1.88 billion from GBP1.71 billion the year before, up 8.5% on a like-for-like basis.
"Progress on our journey to become first choice for our customers, suppliers and employees has delivered another year of revenue growth, market share gains and improved profitability," Electrocomponents Chief Executive Officer Lindsley Ruth said. "Our opportunity remains large, our momentum is strong, and we can continue to improve performance."
"The right investment in scalable infrastructure will deliver another step change in our progress, further differentiating customer experience, improving our efficiency and accelerating share gains," Ruth added. "Therefore we are leveraging our strong financial position to accelerate capital investment in the strategic development of the group to support sustainable long-term growth, whilst continuing to focus on tightly managing our operating costs in what remains an uncertain external environment. Overall, we believe we are well positioned to make good progress in the current financial year."
Electrocomponents proposed a 9.5 pence per share final dividend, up 19% from 8.0p the year prior. For the full year, the dividend rose 12% to 14.80p from 13.25p the year before.
Electrocomponents added that like-for-like revenue growth has "seen a moderation" during the first seven weeks of financial 2020. April revenue had slowed to "low single-digit" growth with performance "impacted by the timing of holidays".
"However, May has started encouragingly with group like-for-like revenue growth closer to the trends seen during the fourth quarter of 2019," Electrocomponents explained in a statement. "Europe, Middle East & Africa (64% of revenue) continues to see good growth and market share gains, which is more than offsetting softness in the Americas (26% of revenue). Asia Pacific (10% of revenue) continues to see similar trends to the fourth quarter of 2019."
Electrocomponents shares were up 3.6% at 628.40 pence early Tuesday.
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