7th Mar 2018 10:06
LONDON (Alliance News) - Door and window components company Tyman PLC on Wednesday reported good profit and revenue growth in 2017, as it also announced a share placing to fund the acquisition of Ashland Hardware for USD101.0 million.
Tyman's pretax profit increased to GBP34.5 million in 2017 from the year before's GBP29.4 million, and on an underlying basis the figure rose by 10% to GBP68.3 million from GBP62.1 million.
Revenue increased by 14%, and 2% on a constant currency like-for-like basis, to GBP522.7 million from GBP457.6 million, helped by contributions from acquired companies Bilco and Giesse as well as favourable exchange rates.
The company said these results were "resilient", given operational issues in Mexico and a subdued market in the UK.
Tyman is to pay a final dividend of 7.75 pence per share, bringing the total payout to 11.25p, a 7.1% increase on 2016's total of 10.50p.
The company also announced Wednesday the placing of 17.8 million shares in an accelerated bookbuild, to be run by Cannacord Genuity, to fund the acquisition of US window and door hardware firm Ashland Hardware for an enterprise value of USD101.0 million.
Dallas-based Ashland recorded revenue of USD67.2 million for 2017 and adjusted earnings before interest, tax, depreciation, and amortisation of USD11.2 million.
Tyman said the price of the placing will be determined at the end of the bookbuild. The company's shares were down 1.3% on Wednesday at a price of 305.00p each.
Commenting on the acquisition, Chief Executive Louis Eperjesi said: "The acquisition of Ashland represents a strategic opportunity to expand our residential hardware offering in North America.
"Ashland offers an excellent fit with our AmesburyTruth business with its established customer relationships and strong product offering. The acquisition gives the enlarged division a viable 'Good Better Best' product offering across multiple categories."
Revenue in Tyman's US-based AmesburyTruth division, which Ashland will join, grew 15% at reported currency rates to GBP332.7 million, with underlying operating profit rising 9% to GBP59.7 million. The ERA division, which operates in the UK, posted a 10% rise in revenue at actual currency to GBP80.3 million, but underlying operating profit fell 13% at actual rates to GBP10.2 million, in a challenging market.
In the SchlegelGiesse division, revenue rose 16% to GBP109.7 million while underlying operating profit increased 36% to GBP12.8 million at actual rates, as European markets recovered and China and the Asia Pacific continued to grow. Latin American markets were subdued in the first half, but then began to recover.
Looking forward, Tyman expects US residential and commercial markets to grow in 2018, though the UK market should contract at a similar rate to 2017. Continental European markets should grow, and Tyman said Middle East and Latin America momentum should continue.
Volumes in 2018 so far are in line with expectations, and each division has a "promising" order book. Tyman is expected a "further" year of profitable growth.
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