29th Aug 2014 10:10
LONDON (Alliance News) - Floorcoverings distributor Headlam Group PLC Friday posted jumps in pretax profit and revenue in the first half of 2014, as it said it saw improvements in its UK and European businesses and hiked its dividend.
Headlam said the second half has started well, and the outlook for the full year is looking positive.
Pretax profit in the six months to June 30 rose 19% to GBP10.8 million, against GBP9.1 million a year earlier. Revenue in the period was up 7.6% to GBP301.6 million from GBP280.4 million last year.
The strong results prompted the company to hike its interim dividend by 12% to 5.20 pence per share, compared to 4.65 pence a year ago.
The group said the revenue growth was driven by the performance of its UK business, where like-for-like revenue was up 7.9% in the period. This was pushed higher by the performance of its residential business, where the strong growth rate resulted in a change to the overall product mix in the business to 69% residential and 31% commercial.
The performance in the UK was also boosted by the improvement in the overall market conditions in the region, with the independent floorcovering retailer and contractor sectors performing well.
The extension of its Coleshill distribution hub was completed in January and is now fully operational, while the company also is planning to proceed with the expansion of a new distribution facility in south east England for its Faithfulls multi-product business.
The group said the contribution to profit from the European business improved, while market conditions in the region have improved slightly. It did caution, however, that market conditions in Switzerland are hampering its overall progress in the European region.
Headlam shares were up 2.4% to 419.75 pence on Friday.
By Sam Unsted; [email protected]; @SamUAtAlliance
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