Management’s focus on high-margin products and services for OEMs across a very broad range of applications in the clean tech, life science and green tech sectors resulted in strong growth in operating profit for m-u-t during H117. This result follows on from a record-beating FY16. The trend is set to continue, with management raising FY17 guidance.
Platform in place to support profits growth
Managements’ hard work creating a profitable, cash-generative platform over the last five years is clearly paying off. Group revenues increased by 11.6% year-on-year during H117, to a record €31.4m. This resulted in strong growth in both EBIT (30.5% rise to a record €5.7m) and EPS (25.5% improvement to €0.64/share). EBIT margin rose by 2.6pp to 18.0%, reflecting higher sales at an improved average gross margin on a fairly constant cost base. Net cash increased by €3.2m to €8.4m. Minimal capex was required as the group already has the infrastructure required to support growth. This cash level gives plenty of scope for further acquisitions of small companies such as APOS, which are at the upper end of the value chain.
Industry trends support further growth
Noting out-performance during H117 and a positive outlook for flexible measurement technology, management has raised FY17 EBIT guidance from €7.3m to €8.0-8.5m (FY16 €6.8m actual EBIT) on sales of €56.0m-59.0m, which is a slight increase on FY16 revenues. Revenue guidance was broadly unchanged. We expect this growth to continue.
Non-contact measurement is a key element of the remote-controlled continuous online measurement approach that is part of the fourth wave of the Industrial Revolution. By engaging with many OEMs, helping each of them create systems tailored for specific applications, m-u-t is able to benefit from growth in multiple segments as and when individual markets take off. Its unrivalled breadth of product portfolio gives a distinct competitive advantage.
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