Photo-me International to beat expectations

Photo-Me International has reported record results for the first-half of the year beating expectations and putting the company on the path to "significantly exceed" market expectations in its full-year results in April. 

The AIM-listed firm, which specialises in instant service equipment, reported revenue up 19.2%, EBITDA up 20.7%, PBT up 20.2%, and EPS up 17.3% to 5.84p/share. At a constant currency rate, the top line beat 2015 by 4%, whilst EBITDA and PBT increased by 4.5% and 4.3% respectively.

The firm's net cash position remained "very strong" at £68m, a £5.6m increase in 6 months, even after investments, the acquisition of Asda's photo division, and increased dividend payments.

finnCap said whilst performance was aided by flattering currency tailwinds, the results were strong and upgraded its FY17E and FY18E PBT forecasts by 14%:

"Upgrading FY17E and FY18E PBT by 14% respectively. The strong H1 underpins an upgrade in FY17E pre-tax profit from £42m to £48m with FY18E moving from £44m to £50.4m."

Non-Exec Chairman John Lewis said the company had made "excellent" progress in H1, with revenues and profits reflecting the success of the strategy management has put in place:

 "We are strongly positioned to be a leader in security based operations.  During the first half we focused on technology upgrades to our photobooth estate in France that allow digitised photos and e-signatures for driving licenses to be securely uploaded.    

The expansion of our laundry business continues to drive our growth and the introduction of our smaller Revolution units are expected to help maintain that progress...

 

The Group's performance for the first half was ahead of the Board expectations and the Board therefore now expects the Group's profits will significantly exceed current market expectations for the financial period ending 30 April 2017."

Photo-me's share price rose 7.5% on Friday and has risen 15% in December. Today's increase seems modest considering the update said management expect to beat expectations in H1 and FY results.