In an update for the year to 31 May 2021, Avingtrans (AVG) said it expects results for the year to be ‘at least in line with market expectations’ following a strong trading performance. As a result, the Company told investors that it will reinstate its progressive dividend policy.
The Group, which manufactures critical components, modules, systems and associated services to the energy, medical and industrial sectors, said its year end net cash position was strong, as it stood in excess of £23m compared to net debt of £7.4m as at 31 May 2020.
Avingtrans’s cash balances have benefited from the successful sale of Peter Brotherhood Limited back in March 2021, which resulted in net proceeds of £30.6 million. To date, the Group’s current orderbook and prospect pipeline also remains ‘robust,’ the Group noted.
As outlined in its half-year results for the six months ended 30 November 2020 published in February 2021, the Board of Avingtrans has confirmed the reinstatement of the Company’s progressive dividend policy, following the dividend suspension last year due to Covid-19.
As a result, the Company said the dividend will be recommended for the year ended 31 May 2021, which will also include an amount to reflect the non-payment of an interim dividend.
Shares in Avingtrans have increased by over 50% in value since the beginning of 2021.
Avingtrans said it intends to reinstate more usual dividend payments in the current financial year, with an interim and full year dividend split, subject to maintaining appropriate financial headroom and flexibility in light of any future acquisition opportunities.
Speaking on the full year dividend in its published half-year results, the group said,‘We intend to fully reinstate our progressive path in FY22, with a more normal interim and full year dividend split, subject to the outcome of acquisition activities in the coming years.’
Steve McQuillan, CEO of Avingtrans, said: “We are delighted with the strong performance of the Group which will report results for the year ended 31 May 2021 in line with the previously upgraded market forecasts. Net cash in the business remains healthy which was strengthened following the successful sale of the Peter Brotherhood business in March.”
He added that, “The Group is in a very good position to execute its PIE (pinpoint-invest-exit) strategy and its pipeline of opportunities is strong. The Board remains confident on the outlook for the Group which is reflected in the reinstatement of the full year dividend.”
Avingtrans will publish its results for the year ended 31 May 2021 on 29 September 2021.
*WATCH* Paul Hill from Vox discuss the financial and operations progress achieved achieved for the 12 month period to 31 May 2021 with Steve McQuillan, Chief Executive Officer and Stephen King, Chief Financial Officer.
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