Essentra reports double-digit growth for 2013

20th Feb 2014 08:15

- Dividend raised 23 per cent- Revenues and profits up double digits- Panmure downgrades stock to 'hold'Packaging group Essentra hiked its dividend by 23 per cent after double-digit growth in revenues and profits in 2013.The final dividend was lifted to 10.6p a share, taking the total payout to 15.4p.The speciality plastic, fibre, foam and packaging components firm reported revenue of £798m for last year, up 20% on 2012. Like-for-like (LFL) growth was 9%, helped by "continued range development, product innovation and investment in both existing and new geographical markets".LFL growth was recorded across all divisions but was particularly strong in Filter Products at 17% after a strong performance in Asia.However, given that this is a lower margin division, the gross margin declined by 100 basis points in 2013 to 34.9% with acquisitions having had a dilutive impact as well.Group adjusted operating profit rose 25% to £130.4m, helped by cost management and the delivery of synergy savings from recent acquisitions. Adjusted earnings per share (EPS) were up 22% at 38p.Chief Executive Colin Day said Essentra is "well-positioned to deliver further balanced growth in 2014". "Results in line with our expectations in overall terms, though with revenues and operating profit slightly light and EPS and dividend slightly above," said analysts at Panmure Gordon.The broker, however, said that at current levels and after a sustained performance in the share price, it has downgraded its rating on Essentra from 'buy' to 'hold'.The stock was down 2.2% at 874.5p in early trading on Thursday.BC