LONDON (ShareCast) - (Sharecast News) - Analysts at Berenberg hiked their target price on chemical manufacturer Treatt from 680.0p to 780.0p on Wednesday following the group's full-year results.
Berenberg stated that Treatt's FY22 results were in line with its expectations and at the top end of revised guidance range but also noted that while top-line progress was "evident", with underlying revenue growth of approximately 9%, this had been "marred by one-off impacts" that weighed on margins.

"While the 6ppt decline in EBIT margin that was experienced in FY22 is difficult in ignore, its latest results were a good reminder of the progress that Treatt has made. The issues that it faced in FY22 have caused management to revisit how it forecasts revenues, manages pricing and hedges its FX exposure - we see this as a sign of a maturing business. Furthermore, Treatt is now "95% complete" in its move to its new UK headquarters, a milestone that should support improved European growth prospects through the medium term, which will facilitate an improving return-on-capital profile, in our view," said Berenberg.

The German bank added that 2023 looked set to be "a normal year" for Treatt, featuring price-led growth, improved margins, and "a more meaningful contribution" from its coffee division.

"We are also gaining more confidence in Treatt's margin recovery, which is reflected in our EPS estimates lifting by 1%/6%/4% for FY23/FY24/FY25 respectively," concluded Berenberg, which also maintained its 'buy' recommendation on the stock.





Reporting by Iain Gilbert at Sharecast.com

Email this article to a friend

or share it with one of these popular networks:

• DIGG
• FACEBOOK
• STUMBLEUPON
• MIXX
• YAHOO BUZZ
• DELICIOUS
• REDDIT
• NEWSVINE