Somero announced its AGM trading update today : the key point is that the "Company's trading to date is in-line with market expectations for the full year ending 31 December 2017."

Regional trading
NOrth America,which accounts for 70% of sales, is only flat. I mentioned this as risk in a post yesterday as the data has been less conducive recently. Partially this slowdown is due to weather and partially due to the uncertainty of the new Government. This isn't a disaster but I would wager the shares will fall a bit today given this slowdown. It leaves H2 as particularly important in terms of trading.

Europe (10% sales) remains strong but the growth insnt quantified (why not?)

China (8% sales) had had a slow start but picking up

The rest of the regions seem ok

So overall the business is growing less fast than a year ago, which we knew from the FY outlook statement, and I would think the shares will pause for breath for a bit.

Balance Sheet
The balance sheet is in good order with $20m of cash, and management will be paying a $7.5m or USC 13c / share special dividend (c11p / share). This should absorb some of the trading disappointment. I would expect further special dividends as cash builds up because management have said in the past that there is nothing to buy. Also I know how scarred they are from the 2008-10 Global Financial Crisis. So expect excess cash to be paid out but a healthy cash buffer to be retained on the balance sheet.

New facility
The group is investing a further $2m in expanding its Fort Myers facility which is good.

Valuation
Under 15x 2017 PE looks fine and with a normal dividend of 2.9% plus a 3% special kicks the yield up to 6%. This is ok, but not the standout buy it was. I am holding on but not adding unless the shares get really oversold.

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