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Clarkson CKN expects both first half and full year profits to be materially below those of last year after the first quarters financial performance fell below the boards expectations. Blame is put on a challenging environment in shipping and offshore capital markets, which caused transactions to be put back, lower freight rates hit the tanker market, and the impact of the lower dollar which is the main currency used by the groups banking and and broking businesses.
It seems unbelievable that only six weeks agree, the company was so full of confidence for the future that it increased its final dividend by 12% after a strong performance in the year to 31st December and following early signs of recovery in shipping markets. On that very same day, the 12th March the chairman proclaimed that it was well positioned for the future and there were early signs of recovery in the shipping market. Does the Board really expect shareholders to believe that two thirds of the way through the first quarter there was not the slightest sign that the company had been hit by serious problems, the disclosure of which which are more than likely to send the share price into a nose dive when markets open this morning.
It actually opens today’s update with the startling confession that during the first quarter it faced ‘certain headwinds’ .Explanations are called for as to why shareholders and markets have been kept in such ignorance.
Rotork ROR Order intake rose by 27% on an organic constant currency basis during the quarter to the 1st April and the order book ended the quarter, 18.6% higher than it started it. The increase was experienced across all divisions and revenues for the full year are now expected to show mid to high singe digit growth.
Morgan Advanced Materials MGAM anticipates that full year headline profit margins will be slightly ahead of last year and also announces its departure from the Composite and Defence Systems business.
Lok’n Store Group LOK Group like for like revenue rose by 8.3% in the half year to the 31st January leading to a rise of 21.3% in adjusted profit before tax. The interim dividend is to be increased by 11% to 3p per share. The company is expected to continue to grow strongly and positive momentum has continued into the second half.
Bovis Homes BVS delivered a record number of homes in the 6 months to the end of June, allowing revenue to grow by 18%, profit before tax by 15% and earnings per share by 14%. Shareholders are rewarded with a 9% rise in the interim dividend to 15p per share and net debt has been slashed from £59m. to £8m.
That all looks very good but it appears to have been achieved mainly by imposing swingeing price rises averaging 14%, to take the average new home price to £254,000. Legal completions during the 6 months rose by only 5%. Take those two figures together and it puts the rise in profits into perspective, whilst at the same time illustrating the boom in the new housing market showed no sign of abating prior to June, save that the weekly private sales rate per site fell from 0.61 to 0.59. Since June however the decline has continued with a fall to 0.5 from 0.58 a year ago. Despite that, as at the 12th August Bovis had achieved over 90% of its planned sales for 2016 and it regards the decline in average sales rates as being seasonal.
Clarkson plc CKN has more than weathered the storm which continues to batter the shipping industry and it rightly claims that its performance for the half year to 30th June was robust. Profit before tax rose by some 70% from £10.8m to £17.5m whilst earnings per share nearly tripled from 15p to 41.7p. All this was achieved in the face of the most challenging rate environment which the industry has seen for many years and no improvement is yet in sight, at least in the short term. The interim dividend is maintained at 22p.
Trakm8 Holdings TRAK is proposing a maiden dividend of 2p per share after profit before tax for the year to 31st March surged by 77%. Revenue rose by 44% and basic earnings per share by 91%. Both of the acquisitions which it made during the year became earnings enhancing and units reporting to its server were up by 50%. Its order book remains strong.
Clarksons CKN expects that profits for 2016 will be materially lower than in 2015. The Baltic Dry Index has continued to fall sharply and reached all time lows in the first quarter of 2016. The Clarksea Index has fallen a further 10% since the AGM and the average in the first half of this year was down 30% on the first half of 2015.
Fastjet (FJET) It seems only yesterday that Fastjet was rapidly extending its network and Sir Stelios had a wide beam on his face. Now, all that can be forgotten and rationalisation of the newly built network has become an urgent necessity. 2016 results will be materially below expectation, the year will not be cash flow positive and the company may need to raise further funds during the course of the year. The source of the problems is that the challenges facing the African aviation industry have been far more prolonged than management envisaged. The shares have been marked down 26% to 49p, prior to the start of trading this morning.
Seeing Machines (SEE) produced record revenue and profits for then half year to 31st December. sales and service revenue grew by 594% Last years loss of A$14.2m has been turned into a profit of A$11.2m. The partnership with Caterpillar proved to be a milestone event, producing a A$21m licence fee which helped to create the record profit.
Clarkson (CKN) has put in a robust performance in what it describes as an incredibly challenging year. Revenue for the year to the end of December and profit before tax both rose by some 25%. despite all the doom mongering in which the media engaged in 2015, overall sea born trade actually grew and the company continues to see signs of a healthier shipping market which is at least one indication that the world economy is perhaps not as bad as pundits proclaim.
Stobart (STOB) Overall performance for the year to 29th February was in line but Infrastructure exceeded expectations with a strong performance. Biomass and Southend airport are seen as the two main driving forces for the future
Petroceltic (PCI) Oil woes spread as trading in shares of Petroceltic International has been suspended as from this morning pending clarification of the company’s financial position.