Small caps round-up

By Alexander Bueso

Date: Tuesday 13 Aug 2019

(Sharecast News) - Ventilation products supplier Volution anticipates that its results for the trading year ended 31 July will be in line with expectations.
Volution saw revenues increase 14.6% to £236m, of which 12 percentage points came from acquisitions. Organic growth came to 2.6%.

In the UK, Volution benefitted from a return to growth in public residential repair maintenance and improvement (RMI) of 5.3%, partly as a result of a "significant enhancement" made to its product portfolio and sales processes over the last two years.

Private residential RMI grew 1.7% year-on-year, with accelerating growth in the second half of 3.8%.

Residential new build systems grew 8.6%, supported by regulatory drivers relating to carbon-efficient residential dwellings and commercial revenues increased 4.1%.

Elsewhere, Volution said its project of rationalising two older facilities into one new purpose-built facility in Reading was now complete, with the AIM-listed group noting that service levels had "returned to normal", leaving it with "substantial capacity headroom to support future growth".

Looking forward, chief executive Ronnie George said: "Whilst there continues to be significant uncertainty in the UK economy as a consequence of plans to leave the EU, our considerable investment in new products, our leading brands, our increasing geographic diversity and the breadth of our product portfolio, gives us confidence in the future."

Automotive retailer Marshall Motor posted a drop in first-half profit on Tuesday amid "challenging" market conditions and cost headwinds, but hiked its dividend and backed its expectations for the full year.

In the six months to the end of June, pre-tax profit dropped 9% to £14.8m on revenue of £1.18bn, up 1.8% on the first half of last year. On an underlying basis, pre-tax profit was down 5.3% to £15.2m and like-for-like revenue was 0.9% higher at £1.16bn.

Overall group costs pushed up 2.5% to £114.9m, driven in part by the company's recent acquisitions, while LFL operating costs ticked up 1.6% to £112.3m.

Marshall said it outperformed the market in all core metrics during the half. LFL new unit sales to retail customers fell 0.4% compared to a market drop of 3.2%, while LFL new unit sales to fleet customers declined 1.1% versus a 3.6% market fall.

The interim dividend was boosted by 32.6% to 2.85p a share.

Chief executive officer Daksh Gupta said: "Despite challenging market conditions, the group has delivered a strong H1 unit sales performance, ahead of both the new and used car markets and underlying profit before tax in line with the board's expectations

"Given continued weak consumer confidence as a result of ongoing political uncertainty over Brexit, ongoing cost headwinds for the retail sector and further potential new vehicle supply constraints in the lead up to the implementation of further emissions-related regulations on 1 September 2019, the board believes it is right to remain cautious regarding the outlook for the remainder of the year. Nevertheless, the board's current outlook for the full year remains unchanged."


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