Amino Technologies rises following positive update

published 4 December 2012

Amino Technologies has shot up on news it will hit full-year results and is to introduce a progressive dividend policy, starting with a 3p full year dividend.

In a trading update for the full year ended November 30th, the set-top box maker said it would deliver "a profit for the year in line with market expectations" following a focus on operational performance and improvements in gross margins.

Revenues, however, are expected to be below consensus at about £41m.

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Consensus estimates for the full year had previously been for pre-tax profits of £2.72m on turnover of £44.71m.

Amino Technologies said that cash conversion for the period had been strong with an improved net cash balance of £17.1m (2011: £14.1m) even after a £1.0m dividend payment.

As part of its focus on operational performance it plans to concentrate R&D at its Cambridge headquarters and will close its Swedish office early in 2013. A move it said would deliver "net cost savings as well as productivity improvements".

The company also said it will be introducing a progressive dividend policy, starting with a 3p full year dividend, 50% up year on year. Not only will it introduce an interim dividend but the company plans to grow its dividend by "no less than 15% per annum for each of the next two years".

Broker commentsBroker Northland Capital reiterated its 'buy' recommendation with a price target of 75p.

It commented: "Management has focused on gross profit/margin progression and cash generation to support a progressive dividend policy. Business remains very well capitalised and offers good exposure to a dynamic sector."

Amino Technologes will announce its full year results on Monday, January 28th 2013.

The shares were up approximately 15% to 65.75p by 12.00.