McBride reinstates dividend as FY profits tick higher

(Sharecast News) - McBride rallied on Wednesday after the cleaning products maker reinstated its dividend as it posted a jump in full-year profit. In the year to 30 June, adjusted pre-tax profit ticked up 1.8% to £54.9m on revenue of £926.5m, down 0.9% on a reported basis but up 0.7% at constant currency.

McBride said it was reinstating its annual dividend, recommending a final dividend of 3p per share for the year.

The company said total sales volumes grew 4.3% year-on-year, with private label volumes up 1.4% and contract manufacturing volumes surging 48.9%.

It said the latter reflects the full-year impact of a new "significant" long-term contract manufacturing agreement, which launched in the fourth quarter of the previous financial year, as well as two new multi-year contracts secured with large FMCG clients in the first half of this year.

Chief executive Chris Smith said: "McBride has delivered another year of strong operational and financial results, marking five consecutive half years of these materially improved profitability levels. This sustained performance reflects the effectiveness of our strategy and the dedication of our teams across the group, further strengthening our industry leadership across Europe.

"We have continued to deepen our customer partnerships, secured new long-term contracts, and reinforced our strategic focus in key markets such as Germany and laundry. These achievements supported by a step up in service levels, alongside disciplined cost and margin management, have enabled us to deliver another year of profit growth and a further reduction in net debt, ahead of our leverage target.

"The reinstatement of dividends reflects our confidence in the business' trajectory and our commitment to delivering long-term shareholder value. These results demonstrate the strength of our core activities and our normalised financial situation, positioning us well for continued growth and investment."

At 1010 BST, the shares were up 9% at 116.80p.

Broker Peel Hunt, which rates McBride at 'buy' with a 190p price target, said adjusted pre-tax profit was comfortably ahead of its £53m forecast.

"McBride is building a track record of consistent earnings performance and strengthened cash flow," it said. "We are not changing our forecasts at this stage, but see upside potential."