Avon Rubber made solid progress in H1 16, reporting 5% growth in both sales and adjusted PBT despite soft conditions in its Dairy market and an absence of high margin export orders in Protection & Defence (P&D). Adjusted diluted EPS grew by 29% due to a one-off tax benefit, accompanied by a 30% increase in H1 DPS. Meanwhile healthy cash generation drove a c.£5m reduction in net debt even after the acquisition of Argus in October. Management expects to meet consensus expectations for FY16 and we would anticipate most market forecasts being maintained. However we have trimmed our top of the range PBT forecasts by c.£1.5m/6% pa, with the reduction driven by the Dairy division. We have also reduced our target price from 1100p to 975p, although this offers material upside given the 25% share price decline in 2016 to date. We remain positive on long term prospects for both of Avon’s businesses and see potential for more encouraging news flow during H2, hence we have returned to a Buy recommendation.