Avon Protection Share Discussion Threads

[cockneyrebel] 25/11/2010 14:01

Picked up more today.

Kept a bit quite on the results hoping for a bit of a profit taking pull back to add on but no such luck, relented and bought this am.

27p eps this year makes these way too cheap imo

Breaking out too.

CR

[penpont] 24/11/2010 20:20

IC comment:


Avon maintains growth
Created: 24 November 2010 Written by: Mark Robinson

Adjust for last year's £2.5m exceptional hit - reflecting the cost of transferring the European dairy production from the UK to the Czech Republic - and Avon's operating profit jumped 68 per cent year on year to £9.26m. That was helped by a 36 per cent cut in finance charges after Avon reduced borrowings and renegotiated banking facilities.
The protection & defence unit - which is focused on making gas masks - remains Avon's star performer. Sales there rose 18.5 per cent year on year to £76.1m and the unit's operating profit jumped 46 per cent to £6.5m, against the backdrop of stable demand from its core customer - the US Department of Defense. Admittedly, Avon's gas mask contract with the UK's Ministry of Defence will end next year, but that should be offset by significant orders from Italy, Canada and Saudi Arabia. Meanwhile, Avon's more mature dairy unit saw sales rise 10.5 per cent to £27.4m and grew operating profit 53 per cent to £4.6m, helped by a recovery in milk prices.
Arden Partners has upgraded its estimates on the back of these figures and now expects full-year adjusted pre-tax profit of £8.8m, giving EPS of 20p (from £7.2m and 15.1p in 2010).

Avon's turnaround in the past few years looks well entrenched and the resumption of dividend payments is certainly welcome. Add that to the impressive growth profile and the shares, trading on an undemanding nine times expected earnings, look too cheap. Buy.

[wjccghcc] 24/11/2010 18:21

I'm a bit sceptical about the 2012 figures with UK mask sales ending in 2011 and the US DoD moving to multiple spares suppliers in 2012. Like Jeffian, I also wish they'd start generating some cash.

[yespmedc] 24/11/2010 17:20

New note -

[penpont] 24/11/2010 16:40

I see Edison have come out with pretty substantial upgrades for this year and next- 27p and 31p eps. They also say there is scope for further upgrades on these.....

They have a sum of the parts value of 250p, which seems quite easily achievable in the near term, based on these numbers.

[jeffian] 24/11/2010 10:09

Not bad, and the market seems to like it. My only slight carp is a disappointment about the conversion of cash generation to debt reduction (net debt has only reduced by £1m despite a one-off capital receipt of £1.7m from property sale-and-leaseback on top of £13m cash generation). OK, the biggest chunk of cash outflow was for investment in property, plant and machinery and, particularly, the installation of a second gas-mask production line which should ramp up sales accordingly, but having held this share through years of mismanagement and delays, I don't yet have full confidence in this Management to deliver. Still, looks like we're on the right track so shouldn't grumble, I suppose.

[martin2729] 24/11/2010 07:28

30 Sep 30 Sep
2010 2009
GBPMillions GBPMillions
REVENUE 117.6 100.9
EARNINGS BEFORE INTEREST, TAXATION,
DEPRECIATION & AMORTISATION 13.6 9.7*
OPERATING PROFIT 9.3 5.5*
PROFIT BEFORE TAX 7.1 4.4*
NET DEBT 12.6 13.6
EARNINGS/(LOSS) PER SHARE:
Adjusted - excluding exceptional items and
amortisation of intangibles 21.9p 14.5p
- excluding exceptional items 15.2p 8.3p
Basic 15.2p (0.6)p
Dividend per share 1.5p -

* Excludes exceptional items of GBP2.5m in 2009

Highlights:

-- Operating profit (before exceptional items in 2009) growth of 68% to GBP9.3m in 2010.

-- Dividend reinstated reflecting business growth and confidence.

-- Reduction in interest payable of 36% from GBP1.5m to GBP1.0m.

-- No income statement exceptional items in 2010.

-- Cash generated from continuing operating activities (before exceptional items) of GBP13.1m (2009: GBP7.4m), representing 142% (2009: 135%) of operating profit.

-- New 3 year banking facilities agreed at a reduced cost.

-- Order intake in Protection & Defence of GBP61.7m (2009: GBP54.5m).

-- In Protection & Defence, non DoD C50 sales at a record level.

-- Return to profit of our fire business, ISI in 2010.

-- First Article Test approval for our new second filter line in Cadillac doubles our filter production capability.

-- Completion of the European dairy production outsourcing on time and to cost.

Commenting on the results, Peter Slabbert, Chief Executive said:

"This year has built on the turnaround achieved in 2009. Our strategy of remaining focused on both our rapidly growing Protection & Defence business and our more mature but high margin and cash generative Dairy business has proved successful. We expect the progress made in 2010 to continue and for operating margins to improve. Further penetration of our current and new markets and the introduction of new products will lay the foundation for additional growth. As a result of the Group's good progress, encouraging prospects and strong financial performance, the Board is recommending the resumption of the dividend."

[cockneyrebel] 08/11/2010 08:09

Breaking out this am - had a few back for the update on 25th Nov.

CR

[18bt] 11/10/2010 07:21

Nice way to start a Monday morning, but why do I feel that PIs have been the last to receive the official confirmation?

[18bt] 30/9/2010 07:08

Announcements this morning that both Prudential and Credit Agricole have stakes >3%

[cockneyrebel] 24/9/2010 12:10

Dunno who's buying but I've taken my profit here as it looks like it's getting ahead of itself imo.

Who knows but that's a steep rise recently and for that reason - I'm out, as Ballentyne would say.

Good luck those that ride it.

CR

[jeffian] 24/9/2010 10:45

I think the only thing that is afoot is the long-awaited return to profit. As a long-term holder, Avon have been serial disappointers over the past few years with the potential excitement of the US gas mask contract outweighed by the costs of dumping the old tyre business and delays in bringing the new Mexican(?) production line onstream, resulting in high debt and the dividend being waived. Hopefully, that is all behind us and at long last we can begin to reap the rewards. According to Yahoo!, analysts' forecasts are for EPS of 14.31p in 2010 rising to 17.92p in 2011 giving a PE ratio of just over 10 falling to 8.5, so the current price represents a modest multiple rather than "the most extraordinary break out" and we are actually just clawing our way back from the bottom.

[18bt] 24/9/2010 10:26

This really is the most extraordinary break out - something must be a foot!

[cockneyrebel] 21/9/2010 13:41

McKenzies shift another 3% and still this flies north - who's buying all these shares in the maket and from McKenzies?

CR

[cockneyrebel] 21/9/2010 11:31

MM's paying 145p for stock - soaking up all the sells they can get.

Cr

[cockneyrebel] 21/9/2010 11:26

Even more today - that's one steep chart forming here.

CR

[cockneyrebel] 20/9/2010 13:15

Chart has broken out of the uptrend resistance too which suggests an even faster rise coming here imo.

CR

[cockneyrebel] 20/9/2010 13:15

Who's been buying all this stock off McKenzies and driving the price up?

Huge volume lately.

CR

[5070481] 17/9/2010 08:58

PIcked some up this morning. Great volume recently, great chart and good prospects.

[cockneyrebel] 15/9/2010 11:02

A lot of buying activity - 2 months to the results.

I'd have thought these were a bid target for a US co if ever there was one.

Cr

[raj129] 13/9/2010 14:58

vol have gone up considerably in last few days,is something in the offing?

[cockneyrebel] 11/9/2010 13:26

SCSW says Buy today.

CR