Analyst reiterates ‘buy’ call on James Halstead shares following AGM update
An analyst has reiterated his ‘Buy’ call on Manchester flooring specialist, James Halstead, following an annual general meeting update this morning (December 6).
Chairing his last AGM at midday today before stepping down, Anthony Wild told the stock market this morning: “Today we will approve our final dividend of 6.0p per ordinary share – yet another record dividend. This marks the 48th year of increase.
“I am pleased to report that trading in the current financial year is on track to meet our expectations of continued progress.
“In addition, cash levels remain strong and ahead of the prior year.
“I, and the board, remain positive about the market most particularly in the healthcare, education and aged care sectors, all of which are areas of government focus on investment both in the UK and overseas.”
Adrian Kearsey, an analyst with investment bank Panmure Lebarum, said: “James Halstead, the UK’s largest commercial flooring manufacturer, has released a trading in line AGM update.
“As seen in FY24, healthy performances in the Middle East and the Americas, are offsetting challenging trading conditions in certain European territories.
“We believe, manufacturing efficiencies (from longer production runs) and ongoing cost management are enabling the team to maintain margins and high returns.
“Therefore, we are leaving our revenue, earnings and FCF forecasts unchanged. Given the ongoing operational momentum, we reiterate our BUY recommendation and 320p (share) target price.”
Shares opened trading this morning at 186.50p, and moved up to 191.50p by 9am.
In October, Halstead revealed annual figures for the year to June 30, 2024, that revealed that profits had improved, despite a reduction in revenues.
Revenues fell by 9.4% to £274.9m, however, pre-tax profits jumped by 7.9% to £56.9m.
Once again, the group increased its final dividend payment by 4.3% to 6p per share.
By the year end cash stood at £74.3m, compared with £63.2m in the previous year.
In October the board also announced that chief executive, Mark Halstead, would step up to the position of executive chairman and current finance director, and a director since 1999, Gordon Oliver, would succeed him as chief executive.
