Avon Rubber issues confident outlook

Avon Rubber lifted full year profit and underlined its confidence in future trading by increasing its dividend payment 20 per cent.

The group, which makes high tech rubber-based respiratory protection to military, emergency and industrial markets, said pre-tax profit rose to £11m for the year ended September 30th 2012 from £10.2m the year before. Revenue slipped to £106.6m from £107.6m previously.

Revenue at protection and defence, which represents 70% of group revenues, fell 4% to £74.6m after lower filter sales to the US Department of Defence. Revenue at its dairy division increased 6% to £32.1m

Chief Executive Peter Slabbert commented: "We have continued our successful track record of growing profits, generating cash and reducing our debt and believe that our investment in industry leading technologies in both protection and defence and dairy will deliver future revenue growth and higher margins."

Order intake in protection and defence soared 42% to £85.2m and the closing order book stood at £45.7m with £40.7m for delivery in 2013.

Avon Rubber, which opened a sales and distribution centre in China, said earnings per share rose to 26.9p during the period from 25.2p before.

Operating margins improved 0.6% to 10.9% while cash generated from operating activities of £14.7m, representing 127% of operating profit.

Net debt reduced by £3.1m to £8.7m while the dividend has been increased to 3.6p from 3p per share the year before.

CJ