Carclo appears to have been the unfortunate victim of VW’s need to clean up its act, with a flagship luxury vehicle now expected to be redesigned as an electric vehicle and the consequent delay thereby affecting Wipac’s performance this year and next. This means that we are downgrading FY16 PBT by 8% from £9.5m to £8.8m and FY17 by 10% from £11.2m to £10.2m. This impact from one programme is disappointing, but the underlying trends for the Technical Plastics and LED Technologies divisions remain positive. We reduce our SOTP target price from 148p to 135p and remain at Hold.
