Flowtech Fluidpower – 176.75p

14 March 2018 – acquisition and placing

The company has announced the acquisition of Balu and its trading subsidiaries, Beaumanor and Derek Lane, for a total consideration of approximately £10.2m.  Beaumanor was founded in 1974 and is an importer and distributor of fluid power equipment in the UK.  Derek Lane was founded in 1979 and is a supplier of fluid power products and engineered solutions.  Unaudited financial statements of Balu for the year to 31 January 2018 showed revenue of £11.4m and proforma EBIT of £1.4m.  Unaudited net assets excluding net debt as at the end of January were £5.9m.  A related placing will see Flowtech raise up to £11.0m at a price of 170p per share.  We see this as a positive development and rate the shares as a BUY.

Empresaria – 89p

14 March 2018 – final results

The specialist staffing business has released results for the year ended 31 December 2017.  Revenue jumped to £357m (2016: £270m) and adjusted profit before tax was £11.0m versus £9.2m a year earlier.  This translated into adjusted diluted earnings per share of 12.5p (2016: 11.3p).  A final dividend of 1.32p was declared (2016: 1.15p).  These are strong results and although there are potential risks the share price looks too low.  SPECULATIVE BUY.

Goals Soccer Centres – 66.5p

13 March 2018 – final results

Results for 2017 have been released.  Although statutory figures were more flattering, underlying results are more relevant and we concentrate on these.  Underlying Sales were £33.1m (2016: £33.0m).  The closure of clubhouses at Ruislip, Beckenham, Glasgow South, Leeds and Wembley during refurbishment impacted like-for-like sales by 0.4% and underlying like-for-like sales adjusted for closures were up 0.1%.  Underlying profit before tax was £6.2m (2016: £7.7m) and underlying diluted earnings per share were 6.3p (2016: 9.7p).  No final dividend was declared.  In the first 8 weeks of 2018 like-for-like sales were up 4% but poor weather hit trading in weeks 9 and 10.  At the current level we feel that the shares offer very good value and rate them as a BUY.

Stadium Group – 120p

13 March 2018 – final results

The group has announced its final results for the year to 31 December and these have revealed revenues up by 15% to £61.1m whilst normalised pre-tax profits increased by 8.5% to £4.6m.  Earnings per share on the same basis rose 10% to 10.0p and a special dividend of 2.1p was declared in lieu of any final dividend following the offer for the company by TT Electronics.  As we noted on 15 February the company has received a cash offer of 120p per share which has been recommended by the company and with no other offer forthcoming shareholders should accept this.  ACCEPT THE OFFER.

Surgical Innovations – 3.8p

13 March 2018 – final results

The medical products group has announced its results for 2017 which have revealed a 44% rise in turnover to £8.75m (2016: £6.09m) with adjusted pre-tax profits rising substantially to £1.1m (2016: £0.3m).  Earnings per share on the same basis rose to 0.19p (2016: 0.15p) with the lower rate of growth due to a reduction in the tax credit received.  No dividend was declared.  Net debt at the end of the year was £0.73m (2016: net cash £0.72m).  During the year the group completed the transformational acquisition of Elemental Healthcare for £9.4m and the integration of this is now complete.  The current financial year has started well with revenues well ahead of the corresponding period last year helped by the acquisition of Elemental – although there have been some constraints on sales to the NHS in the core business these now appear to be returning to normal.  There are significant growth opportunities for the group going forward with acquisitions likely to be used to supplement organic growth and we continue to rate the shares as a BUY.

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