14th Apr 2015 10:34
LONDON (Alliance News) - Flowtech Fluidpower PLC Tuesday proposed its maiden dividend after swinging to a pretax profit in 2014 following from its initial public offering in May, and said it enters 2015 "in a strong position".
The distributor of fluid power products based in the UK, China and Benelux swung to a large pretax profit of GBP30.4 million from a GBP234,000 loss in 2013 on the back of a GBP29.0 million gain on the settlement of its debt.
The company listed in May last year, and said the GBP47 million equity and net bank debt that was raised was used to partially clear loans from the previous equity owners prior to the IPO. Flowtech said the GBP29 million in shareholder loans were subject to a debt for equity swap, which resulted in a gain.
"The IPO represented a major milestone in Flowtech's development with the move from private equity to public company status a memorable and huge step forward for us all. This fundamental change in both ownership and financial structure has allowed the business to concentrate on its growth strategy," said Chief Executive Sean Fennon.
The company's pretax profit, excluding the GBP29 million gain and IPO and restructuring costs totalled GBP6.0 million, as revenue rose to GBP37.8 million from GBP32.1 million.
As a result, the company proposed a 3.33 pence per share final dividend, which when combined with the 1.67 pence interim dividend, gives a total 5.0 pence per share dividend for 2014, the company's maiden dividend to its shareholders.
"We have demonstrated that we can deliver profitable, as well as consistent, levels of service to our diverse customer base. There is also significant opportunity for us to achieve organic growth through product development and international expansion and enhancing this through acquiring businesses that have high quality management and staff who can work with us to deliver our corporate strategy," said Fennon.
The company's net debt position stands at GBP6.7 million, significantly down from GBP69.8 million at the end of 2013.
Still, Flowtech shares were down 4.7% to 120.97 pence per share on Tuesday morning.
By Joshua Warner; [email protected]; @JoshAlliance
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