24 May 2011 – final results

Excellent final results have been reported by Lees Foods for the year to 31 December 2010.  Although sales for the year rose by just 3% to £18.7m (2009:£18.2m), pre-tax profits before exceptional items rose by 22% to £1.03m (2009: £0.84m).  Earnings per share on the same basis on continuing operations were 63% higher at 29.28p (2009: 17.98p) and the dividend was increased to 7.5p (2009: 7.2p).  Net cash at the year end had increased to £1.02m (2009: £0.37m). 

Although there had been some concern over the impact of higher packaging and raw material costs, the company has clearly comfortably absorbed these and it is no surprise to see the share price moving higher.  Although the outlook for commodity prices remains unsettled, the company has proved it can cope with these fluctuations.  Even after this morning’s share price rise, the company is still only capitalised at £4.85m and it has over £1m in net cash.  The shares remain a BUY.