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Chamberlin

  • BY: Andrew Hore |
  • POSTED: 28/01/2013 |

Castings supplier Chamberlin says weaker demand means that it will not meet profit expectations for the year to March 2013.

Chamberlin had been expected to make £2m this year having already reported an increase in underlying interim profit from £797,000 to £914,000. The 2011-12 profit was £1.7m and it appears that the second half profit will be flat or lower this year. Seven weeks ago Chamberlin said that trading was in line with expectations.

The problems are in the foundry operations which are operationally geared. Customers have reduced or deferred orders. There was no mention of the hazardous environment lighting and security products businesses so presumably these are still trading strongly.

Net debt fell by £1.15m to £887,000 in the 12 months to September 2012 and the business remains cash generative.

The share price has slumped 20.5p to 126.5p, which values Chamberlin at £10.1m. Assuming a maintained final dividend of 2p a share, making a total dividend of 3.25p a share, the yield is 2.6%.

Finance director Mark Bache was removed from the board at the end of 2012 but this did not relate to the financial position of the company.

Diverse Income Trust increased its stake in Chamberlin to 8.43% a fortnight before the profit warning.

Download the latest AIM Journal from http://www.hubinvest.com/AIMPDFJanuary2013_40.pdf

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