Engineering group’s shares soar to three-year high
Shares in engineering group Goodwin reached a three-year high on Friday after it revealed a significant jump in profits and a much more progressive dividend policy.
The Stoke-on-Trent group increased pre-tax profits to £13.3m, up 44% in the year to April.
Goodwin’s share price rose more than 35% since publication of its full-year figures, with Thursday being its best single day on the markets since September 1996.
The board decided to nearly double the dividend, from 42.3p to 83.5p, and now plans to increase its average dividend to 38% of post-tax profits plus depreciation and amortisation.
Chairman John Goodwin said: “The group gearing as at the 30th April 2018 was just 11%. It is for this reason and with our vision for the future that the board feels confident that the alteration of the dividend policy is safe and viable now and going forward.”
Historically most of the group’s sales were generated by manufacturing products under licence but today it primarily manufactures its own products that it sells direct to market in 96 countries.
For the last 20 years it has reinvested 70% of its annual profits on average, into activities including designing and developing products and expanding its global markets.
It now plans to limit investment to a maximum of 55% of post-tax profits, on a three-year rolling annual average. This will enable the group to pay an increased dividend.
