Portmeirion (PMP)

Right, I’ve mentioned PMP on the thread plenty of times but the blog here seems a rather good place to post a bit of detail where it doesn’t get lost perhaps - so here goes - it’s one I really like for these reasons:




Results on Aug 10th, a week today



Firstly, and recent news to me is that since they floated 17 years ago they have always paid the divi despite the 2000 and 2007 market falls.



This aside tho - the thing that makes me confident is what the co has said



Interims last year produced 3.5p eps on sales of £17m and an interim divi of 3.55p



Full year was 24.7p eps on sales of £43.2m and a final divi of 12.25p making 15.8p for the year.



The acquisition of Spode and Royal Worcester’s designs and I.P. last year has added a lot to sales but only 2 months of Spode was in last year’s interims. This means this years interims will get 4 months of the additional Spode sales.



In the recent results they said that this year, sales are up 40%. Lets say in the last two months of the interims the comparisons get tougher as they had Spode then - lets say total sales for H1 are only up 25%.

That will mean Sales in H1 of £21.25m. If sales never rose at all in H2 then that would be £26.2m in H2 and £47.45m sales for the year. That’s basically what brokers are forecasting for this year, sales of £47.2m !



So even if sales are up 40% so far in H1 and the underlying business without Spode would be growing at about 10% brokers are forecasting far less - the co says Spode only made up half of the sales growth.



On broker forecasts PMP will do 31p eps and pay a 15.8p div this year.



But if you look at the forecasts going forward brokers are only saying £48.7m sales next year and £50m the following year. £50m sales are expected to produce 37p eps in two years time but looking at the sales growth this year I’d have thought £50m sales is easily possible this year.



Perhaps I’m being too optimistic but these forecasts don’t sound like those of a co growing much larger either, but at the interims last year PMP said this:



“"We are pleased with these results. Buying the Spode and Royal Worcester brands

is the most significant event at Portmeirion for many years, giving us the

opportunity to grow to be a significantly larger company. “


Very little debt, a great yield, a very nice chart and one of those boring investments - china pottery - that has little hype in the valuation but lot's of scope for a pleasant surprise in my opinion.


Anyway, on the basis of the above I hold and have held for nearly a year now and I think there’s scope for decent upgrades here.



All just my opinion, not investment advice in any way. Just a stock that I rather like and something I’ve been buying more of lately @ 370p-390p.  Pleased to here the opinion of others.