Porvair Share Discussion Threads

[rivaldo] 28/6/2012 13:36

Ta Apad. Hopefully that'll bring in more buying tomorrow and next week.

[cockneyrebel] 27/6/2012 20:18

Cheers Apad - nice coverage.

CR

[apad] 27/6/2012 18:00

IC, CR

Porvair flying high

By Lee Wild , 26 June 2012

Despite prepping the market just a month ago, Porvair' s numbers still exceeded forecasts. Strength in America is easily offsetting some weakness in southern Europe and China, too, so full-year profits will now be a little better than expected, a clear signal for analysts to revisit estimates.

And they have. Peel Hunt increased forecast for adjusted pre-tax profit in 2012 by 4 per cent to £5.6m, giving adjusted EPS of 8.9p (from £4.5m and 7.3p in 2011). And there's every chance the two-year upgrade cycle has further to run, especially given the ramp up of aircraft production at both Boeing and Airbus. Demand for Porvair's inerting filters fired aerospace revenue up 29 per cent, driving a double-digit increase at the microfiltration division to £21.3m and an 11 per cent rise in operating profit to £2.2m. Operational gearing, low gas prices and a trio of higher-margin patented products helped metals filtration, too, increasing sales by a fifth and doubling profit. And Porvair is half-way through tests on a new generation of filters for molten metals. Results, so far, are said to be encouraging.

Elsewhere, the three recent acquisitions are starting to chip in, but there's nothing new on the horizon, we're told. There's also an outside chance that some money from the $10m-$15m (£6.4m-9.6m) design contract with South Korea's POSCO will fall into this financial year.

PORVAIR (PRV)
ORD PRICE: 123p MARKET VALUE: £52.4m
TOUCH: 122-124p 12-MONTH HIGH: 134p Low: 78p
DIVIDEND YIELD: 2% PE RATIO: 14
NET ASSET VALUE: 103p* NET DEBT: 13%

Half-year to 31 May Turnover (£m) Pre-tax profit (£m) Earnings per share (p) Dividend per share (p)
2011 31.1 1.63 2.7 1.0
2012 35.9 2.41 4.0 1.0
% change +15 +48 +48 -

Ex-div: 1 Aug

Payment: 7 Sep

*Includes intangible assets of £40.4m, or 95p a share

IC VIEW:

Some weakness in Europe was always likely, yet America, Porvair's largest market, grew sales by 26 per cent. Supplying the booming aerospace industry is a huge help and order books elsewhere are "robust". A forward PE ratio of 14 isn't demanding, either. Buy.

Last IC view: Buy, 122p, 25 May 2012

[cockneyrebel] 27/6/2012 11:39

Sort of stock that will get tipped in IC on Friday imo - their coverage shoud be interesting imo.

CR

[shauney2] 27/6/2012 09:23

From the local

[apad] 27/6/2012 08:34

In addition to the above I liked the (historic) price to cash flow and price to free cash flow figures (well below PER) - also good to see cash flow mentioned in interims. I also appreciated the straightforward language in the statement. Have bought an initial holding this morning.
apad

[rivaldo] 26/6/2012 11:59

Agreed.

Here's DS's take - they have a 159p valuation (as CR posted) and I've copied the conclusion:



"Management expectations for profitability for the full year have been increased. The three small acquisitions made in H1 will contribute to performance in H2

Porvair has delivered another strong set of results with aerospace revenues continuing to outperform the group in terms of YoY growth. As we move closer towards the implementation of fuel-tank inerting regulations for aircraft we would expect revenues to remain robust in this division.

We would have liked to have seen an increase in interim dividend given the strong cash generation in the period. However, in line with previous years, we expect the dividend increase to come in January with the announcement of FY results. We maintain our BUY recommendation."

[owenski] 26/6/2012 11:10

I think their full year will come in at a lot more than 8.9p. Suspect it might be a bit closer to 10p

[cockneyrebel] 26/6/2012 10:48

I would think a positive trading update later in the year once the earnings are pretty much nailed imo. Chart through recent resistance too. Dow Jones interview:





--Strong U.S. and U.K. sales make up for weak performance elsewhere
--Trading struggles in southern Europe
--Peel Hunt raises full-year adjusted EPS projection to 8.9 pence

(Adds chief executive comment in second, third and fourth paragraph, detail and updates share price in last paragraph)

By Michael Auslen

LONDON--Porvair PLC (PRV.LN), a filtration and environmental technology firm, Tuesday reported first-half profit grew 48% and said its second half will be aided by a strong order book and recent acquisitions, prompting the company to raise its full-year profitability forecasts.
Chief Executive Ben Stocks said in an interview with Dow Jones Newswires, he expects strong demand for its U.S. and U.K. businesses to bolster the company during the remainder of the fiscal year.
"49% of our sales is in the U.S., and just about all of our U.S. markets are going well. Those more than compensate for the various weaknesses we find, and the general picture is positive."
In Europe, "Germany is going across quite nicely, but southern Europe is quieter, not dead, but not as good as last year. The pipeline of work is still quite strong, but the speed at which the work is moving through the pipeline seems to be slowing down a bit," Mr. Stocks added.
Results from Porvair's Chinese markets are expected to be weak because of investments the company plans there, according to Mr. Stocks.
The company reported a 2.4 million pound ($3.74 million) pretax profit for the six months ended May 31, as revenue grew by 15% to GBP35.9 million. It declared a flat interim dividend of 1 pence.
It added the second half will be aided by a stronger order book and expected returns from three acquisitions made during the first six months. Porvair bought Pulse Instrumentation, Pell Industries and a product line from Aim Laboratories for a total of GBP3.5 million.
The company said it is raising its expectations of profitability for the full year, but didn't provide numbers. Broker Peel Hunt raised its expected adjusted earnings per share to 8.9 pence from its previous forecast of 8.6 pence. The broker has a buy rating on the stock.
Shares at 0915 GMT were up 1 pence, or 0.8%, at 123.5 pence.
-Write to Michael Auslen at [e-mail]

[cockneyrebel] 26/6/2012 10:32

Dan Stewart target 159p today

CR

[dolphinspirit] 26/6/2012 10:13

All sounds good to me.
Here's hoping £1.60 by year end.

D

[gardenarc] 26/6/2012 08:08

To just add not that many shares in isue, a short ness of stock would make this one fly..

[rivaldo] 26/6/2012 08:08

Great results - excellent cash flow and debt reduction, and looks like North America will drive the group forward if Europe continues to stutter.

Above all:

"Management's expectations for profitability for the full year have been increased".

So we should now get broker upgrades.

And the three acquisitions in H1 should mean a very nice H2 indeed.

[cockneyrebel] 26/6/2012 07:38

Clearly some co's going great guns.

Even if H2 was flat they are going to meet expectations but at this growth rate and the co saying it's raising guidance they look like doing a fair bit better than currently forecast imo.

all imo/dyor etc.

CR

[battlebus2] 26/6/2012 07:33

Lovely results :))

Highlights

-- Revenues grew by 15% (14% in constant currency) to GBP35.9m (2011: GBP31.1m).
-- Profit before tax increased by 48% to GBP2.4m (2011: GBP1.6m).
-- Earnings per share up 48% to 4.0 pence (2011: 2.7 pence).
-- GBP3.5m invested in three small acquisitions. All have been integrated and will contribute to performance in the second half.

-- Net debt reduced by GBP3.1m to GBP5.8m (2011: GBP8.9m) over last 12 months.
-- Metals Filtration:
o Good performance driven by patented products and stronger demand in end markets;

o Operating profit margins improving.

-- Microfiltration:
o Aerospace revenues up 29% with healthy schedules for the second half;

o Order position strong;

o Seal Analytical revenues up 8%.

-- Interim dividend of 1.0 pence (2011: 1.0 pence) declared.
-- Management's expectations for profitability for the full year have been increased.

[gardenarc] 26/6/2012 07:24

Looking good .

[lurki0] 26/6/2012 07:12

Superb results. Congratulations to the Board and all holders.

[cockneyrebel] 25/6/2012 09:09

Buyers here this morning - results tomorrow.

CR

[rivaldo] 18/6/2012 09:41

New lab products launched today (see below). My interest was piqued not specically by this story, but more by scrolling down and reading all the other stories about PRV unveiling/launching/exhibiting new products over the last few months:

[rivaldo] 13/6/2012 09:39

Interim results will be out in two weeks' time (26th June).

Latest forecasts are for 9.3p EPS this year and 11p EPS next year, with 2.7p and 3.2p dividends respectively.

Hopefully this is just the start of a run-up given the excellent trading statement just two weeks ago.

[jaws6] 13/6/2012 09:38

any note out today ?

[lurki0] 27/5/2012 10:14

Sterling work, Rivaldo.

[rivaldo] 25/5/2012 15:47

The IC will be featuring PRV next week in a very positive light:



"Porvair still performing
By Lee Wild, 25 May 2012

■ Interim revenue up more than 10 per cent
■ Strong order books
■ Acquisitions contributing well

With dark clouds hanging over global equity markets, now is a good time to reassure shareholders. Top marks then to specialist filter firm Porvair . Just a month before results for the six months to 31 May it informed investors that this year will be much better than last.

In fact, revenue excluding currency fluctuations will be up over 10 per cent on the £31m reported in 2011, driven by strong growth at both its businesses. Order books look good and the pipeline of potential projects at microfiltration is encouraging. A large slice of that is likely to be aerospace work, given Porvair supplies aircraft manufacturers with inerting systems for planes to suppress sparks in fuel tanks and coolant filters for the Boeing 787. The metals filtration division, meanwhile, is grabbing market share. Margins have been improving here and double-digit returns look likely before long, especially now that the US motor industry is growing again. A £3.4m spending spree, part bankrolled by healthy cash generation, appears money well spent, too. The three acquisitions – Pulse Instrumentation, Pell Industries and the Block Digester business of Aim Laboratories – have fitted in nicely and are all doing well.

IC VIEW:

True, Porvair has exposure to some cyclical industries and around a third of its sales come from the UK and continental Europe. That said, the American economy chips in over 40 per cent and Asia is improving. What's more, at 122p, the shares trade on just 14 times forward earnings, undemanding and a discount to peers. Buy."