Glisten plc – A Company to Watch
The financial year to 30 June 2008 proved to be a good one for Glisten plc, the fast-growing confectionery and snack foods group, with the company producing a strong set of results. The group has steadily driven its business towards those areas of snacking which are believed to have long-term potential with a particular focus on healthier and premium sectors. The group believes that by concentrating its efforts on producing affordable treats, many with a healthier dimension, its business will hold up well during what seem likely to be more demanding economic conditions.
Highlights
Pre-tax profit was up 18% to £6.7m before exceptional items
Earnings per share on the same basis were up 15% to 34.1p
The dividend for the year was raised by 7% to 2.25p
Net debt at the year end was £25.2m for gearing of 89% after spending £10.3m on acquisitions
Glisten is a fast-growing snack and confectionery group which joined AIM in June 2002 when its annual sales were £14.3m – they are now almost £74m. The group’s principal activities are the manufacture of cereal, fruit snack bars and health bars many of which have a diet-control dimension. It is also a leader in organic and natural snacks and premium confectionery. Its brands include ‘Fruitus’, Dormen and ‘Sunmaid’.
What lies ahead for Glisten…??
The company will be concentrating on strengthening the balance sheet and thus does not envisage making major acquisitions over the next twelve months. However, current trading is more than satisfactory with turnover up 19% for the first 2 months of the new financial year and full year profits are forecast by brokers to come out at around £7.2m at the pre-tax level, some 7% higher than last time. This would give earnings per share of some 36.5p.
Simon Flather of Redmayne-Bentley commented ‘The latest results demonstrate the success of the group’s strategy and yet the weakness seen in AIM shares in general has led to the company’s share price falling to the current level of 243.5p from last year’s high of 415p. For long term investors the shares look undervalued although the high level of borrowings is a slight cause for concern. However, the strong operational cash flow combined with the lack of acquisition activity should allow borrowings to fall in the current year. Glisten is a company to watch over the forthcoming potentially challenging year on AIM.’