Confirmation of a “very successful” start to 2018 is reassuring, given a softening in H217 after marked progress in the preceding half. Albeit from a low base and not strictly comparable, EBIT in Q118 more than tripled, thereby underpinning management guidance of a full-year out-turn once again up by a third, after adjusting for 2017 exceptionals. Prospects are also positive for next year as consensus forecasts of a further 10% rise in revenue on a tight cost base drive trading margin to 10%, which management regards as a “realistic target” (9% 2018e and only back to pre-crisis level). Despite investment (8% of 2017 sales) finances are robust.
Building on success
Strong growth resumes
Full-year 2017 saw initial group figures, so there are no available comparatives for the previous period or the quarterly level. However, the dominance of parent company Datron AG (DE:DARG) in the group allows its performance to be taken as a good proxy. Q118 saw a double-digit percentage rise in revenue, which, given overhead recovery, led to EBIT up from €0.2m (DATRON AG) to €0.7m (group). Order intake (slightly ahead y-o-y) was also positive. Such buoyancy fuels continued expansion, notably €2m investment in a specialist tool technology operation. In addition, 2018 guidance is maintained, ie revenue c €55m (+9%) and EBIT c €5.0m (+30%, excluding exceptional 2017 gains of €0.9m on a business disposal and €0.4m on consolidation). This is all the more encouraging as H217 saw lower revenue and EBIT (guidance was slightly missed), in marked contrast to an upbeat first half.
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