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William Sinclair

  • BY: Andrew Hore |
  • POSTED: 29/07/2013 |

Shares in horticultural products supplier William Sinclair have lost one-sixth of their value as the company admits that it will lose money in the year to September 2013.

House broker WH Ireland has cut its forecast for the second time in seven weeks. A forecast profit of £300,000 has been turned into a £500,000 loss on forecast revenues cut from £49m to £48.2m. The profit forecast for 2013-14 has been slashed from £2.5m to £1m. The forecast dividend of 4.5p a share is being maintained.

The cold spring meant that there was a significant shortfall in horticulture sales and the anticipated upturn has not been great enough to make up for this. Peat substitute SuperFyba has been hit by production problems and less than forecast will be produced this year. This has led to increased costs of around £500,000. Solutions have been identified for the problems but they will continue to hit the company’s figures early in the next financial year.

The Lands Tribunal hearing about the compensation for the closure of the Bolton Fell closure. So far £9m has been received and the additional cash helps to underpin the valuation. NAV was £12m at the end of March.

At 126.5p a share, William Sinclair is valued at £21.6m. The shares are trading on 29 times 2013-14 prospective earnings.

Download the latest AIM Journal from http://www.hubinvest.com/AIMPDFJuly2013_46.pdf

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