News blog
Walker Greenbank
- BY: Andrew Hore |
- POSTED: 18/04/2010 |
Interior furnishings supplier Walker Greenbank recovered strongly in the second half of the year to January 2010.
Revenues declined from £63.7m to £60.4m. The US and Italian markets were weak. The Sanderson and Harlequin brands have been recovering but the upmarket Zoffany brand is still being hit by reducing sales.
Pre-tax profit slumped from £2.79m to £1.55m. Nearly all of that decline was in the first half. The manifesting operations moved back into profit in the second half.
Net debt has halved from £6.2m to £3.1m over the 12 month period. That is less than one-third of the level five years ago. There are total bank facilities of £16.5m. Walker Greenbank’s strong balance sheet will help it to prosper, especially as many competitors do not have the cash to invest in their product design.
The strong cash generation has enabled Walker Greenbank to announce its first dividend for many years. The 0.5p a share dividend will be paid on 6 August.
There has been an increase in the pension deficit to £5.72m. This is due to lower discount rates.
Walker Greenbank has not seen any suitable acquisitions. The potential opportunities it has looked at have been too small. Ideally, a potential acquisition should have annual revenues of £8m-£10m. Management would prefer to take market share than make an acquisition at the moment.
The 150th anniversary of Sanderson should provide a boost this year. Edison forecasts a profit of £3m in 2010-11.
At 34.5p a share, Walker Greenbank is valued at £20.2m. The shares are trading on nine times prospective earnings for 2010-11.
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