News blog
Widney
- BY: Andrew Hore |
- POSTED: 29/05/2008 |
Engineer Widney returned to profit at the interim stage but warns that trading is difficult.
Start-up costs of the Northampton painting facility are the main reason behind the disappointing interim profit and FinnCap’s full year profit forecast downgrade from £1m to £400,000.
The shares dived 3.25p to 10.5p, valuing Widney at £2.71m.
Revenues dipped from £17.4m to £15.4m in the six months to March 2008. Some of the revenues lost when Widney Cabs went into administration have been replaced by new business. The interim loss of £3.36m was turned into a profit of £105,000. Earnings per share of 0.98p were flattered by a tax credit.
Although the Northampton painting facility is losing money it should break even by September. Annualised revenues are £3m.
Net debt was £2.79m at the end of March 2008. Widney is maintaining the interim dividend at 0.5p.
The shares are trading on less than eight times prospective earnings for 2007-08 – based on a 10% tax charge. FinnCap forecasts profits of £1m for next year, which cuts the prospective multiple to three.
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