Blog
James Halstead: confident of meeting market expectations – of course!
Posted 05/08/09
James Halstead, the AIM quoted manufacturer of commercial flooring, and one of our AIM favourites, issued ‘the usual’ confident trading update recently reaffirming that they were ‘fully confident of meeting market expectations for the full year’, despite challenging market conditions in the UK which represents approx 40% of total sales.
Over the last six months they have seen a number of school, hospital and UK government PFI projects being delayed or deferred and there has been a slowdown in sales. Thankfully they have continued to experience good growth in many overseas markets including Germany, the group’s largest overseas market.
Although sales prices are under pressure, with softer raw material prices and energy costs margins have been maintained. In addition, the performance of outsourced flooring products, positive exchange rates and overseas earnings means that everything remains on target.
Despite being one of the larger AIM companies (mkt cap c£223m) and a business that is cash rich (£31.7m at the interim stage) JHD isn’t well followed with only the house broker consistently issuing guidance.
The free float of only approx 55%, average daily traded volume of approx 12,000 share gives some idea of why interest is low. Furthermore, JHD hasn’t called on the services of corporate financiers very much over the last few years so despite its size broker’s potential fee income is probably on the low side!
The shares are currently trading at sub 10x June 2010 estimates and currently yield over 5.5% covered just under 2x.
This entry was posted 2 years, 6 months ago and was filed under James Halstead.
