The acquisition of ET Clay Products maintains the strategy of finding accretive deals which broadens the spectrum of its offering and expands its supply base, through new access to a range of overseas manufacturers. The £11.6m consideration represents a takeout multiple of 3.9x historic EBITDA and is immediately earnings enhancing. At the headline level we increase FY23E EPS by 3.5% to 10.6p and FY24E EPS by 7% to 11.2p. The share price continues to be weighed down by negative sentiment towards its core client base and in our view, this underestimates the breadth of the group's offering and its track record of delivery. On a FY23E EV/EBITDA of 5.5x and dividend yield of 4.3% we reiterate our BUY.
