27th Apr 2015 08:30
LONDON (Alliance News) - Sprue Aegis PLC Monday said its pretax profit almost doubled in 2014 as European sales rose substantially, but warned that although revenue in 2015 will be higher than expected, it believes its pretax profit will be below market expectations due to the strong pound cutting into gross margins.
Sprue Aegis shares were down 8.0% to 315.00 pence per share on Monday morning.
The home safety product developer said its pretax profit almost doubled in the year ended December 31, to GBP9.7 million from GBP5.1 million as revenue was boosted by increased sales in Europe.
Revenue climbed 36% to GBP65.6 million from GBP48.4 million, helped by a GBP21.3m increase in sales into Continental Europe, largely due to growth in sales into France and, to a lesser extent, Germany. UK trade sales rose by 9% in the year, but overall UK sales fell by 10%.
Sales to fire and rescue services fell 13%, whilst sales to the utilities and leisure industry dropped by 12%, and its Pace Sensors Ltd division experienced a 44% fall in sales.
Sprue Aegis said the full-year dividend for 2014 will be 8.00 pence per share, consisting of the company's maiden interim dividend of 2.0 pence and a final dividend of 6.0 pence, up from 6p the year before. The company said it "continues to pursue a progressive dividend policy".
At the end of 2014, Sprue Aegis had GBP15.9 million in cash, with zero debt.
"France is performing ahead of management's expectations with a significant order book extending into the second half of 2015. As a result, the board now expects Sprue's revenue for 2015 to significantly exceed market expectations," said Executive Chairman Graham Whitworth.
"However, due in particular to sterling's strength against the euro continuing to adversely impact gross margin, it expects the group's profit before tax, before share-based payments charge, for 2015 to be marginally below market expectations," he added.
At like-for-like exchange rates with the previous year, 2014 group profit would have been approximately GBP1.7 million higher than reported, it said.
By Joshua Warner; [email protected]; @JoshAlliance
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