13th Sep 2016 07:47
LONDON (Alliance News) - Flowtech FluidPower PLC on Tuesday raised its interim dividend as it reported higher profit and revenue during the first half of the year and said its debt pile remains within its covenant range despite a large increase during the period.
The specialist technical fluid provider reported revenue of GBP27.4 million in the first half of 2016 compared to USD21.4 million a year earlier, pushing gross profit up to GBP9.6 million from GBP7.2 million.
Total administrative costs increased to GBP4.9 million from GBP3.1 million, but operating profit still managed to rise slightly to GBP3.3 million from GBP3.0 million.
The pretax profit from continuing operations in the half amounted to GBP3.1 million, rising from GBP2.9 million last year.
The interim dividend was raised to 1.84 pence from 1.75 pence last year.
Net debt at the end of the half stood at GBP14.1 million, almost double the GBP7.5 million at the end of June 2015 and higher than the USD4.0 million reported at the end of 2015.
Looking specifically at revenue, the Flowtechnology unit reported growth of 3.0% to GBP18.1 million from GBP17.5 million, the Power Motion Control division more than doubled revenue to GBP8.3 million from only GBP3.9 million, and the Process unit generated its maiden revenue of GBP1.0 million in the half.
"As we previously indicated, the group operates in a "live" pricing environment, and it is increasingly certain that input prices for many core product lines will increase in the second half and early 2017 on the back of the sterling downgrade," said the company.
"The board is confident that we will be able to maintain overall margins by a mixture of selling price increases and supplier support. The fluid power sector as a whole has come to expect a heavy bias towards US dollar and euro denominated supply lines, and the macro economic situation is well understood by the sector's decision makers," Flowtech added.
The company said trading has continued in line with expectations since the end of the first half and, despite "some disruption" during the post-Brexit vote period, results for the full year should be in line with expectations.
Flowtech shares were up 0.8% to 130.10 pence per share on Tuesday morning.
By Joshua Warner; [email protected]; @JoshAlliance
Copyright 2016 Alliance News Limited. All Rights Reserved.
Related Shares:
Flowtech Fluid.