Portmeirion Group PLC (LON:PMP) shares rose on Thursday after the ceramics maker saw its first-half profit jump by almost a third after a strong trading performance and rewarded shareholders with an over 8% hike in its interim dividend.
The AIM-listed firm – manufacturer of high-quality homewares under the Portmeirion, Spode, and Royal Worcester brands - posted pre-tax profits of £2.1mln for the six months to 30 June 2018, up 29% on the £1.6mln reported a year earlier.
READ: Portmeirion Group weak as homewares firm’s update fails to excite though first-half sales rose
The profit came as Portmeirion’s first-half revenue rose by 11% to £36.9mln, up from £33.1mln a year earlier, helped by a fall in finance costs as net debt was reduced to £1.3mln from £1.7mln.
Portmeirion Chairman Dick Steele said: "We are delighted with our strong first half trading performance, which benefits from new product launches and further diversification into new markets."
He added: "Our strategy continues to deliver revenue and profit growth and we remain confident in our ability to meet full-year market expectations."
The group increased its interim dividend to 8.0p per share, up 8.1% from the 7.4p paid a year earlier.
In late morning trading, Portmeirion shares were 4.1% higher at 1,169.00p.
Brokers upbeat
In a note to clients, analysts at City broker Cantor Fitzgerald repeated a ‘buy’ rating on Portmeirion shares, and increased its target price to 1,250p from 1,220p to reflect “the strong H1 performance and our confidence in the trading prospects ahead of peak.”
The analysts said: “Good growth has been seen across both the core Ceramics business along with the newly integrated Home Fragrance division.
“With the seasonally important second half still to come the business is well placed ahead of its peak trading period and we leave our estimates unchanged.”
Meanwhile, analysts at Panmure Gordon repeated a ‘buy’ rating with a 1,390p target price on Portmeirion shares.
They commented: “Good growth has been seen across both the core Ceramics business along with the newly integrated Home Fragrance division.
“With the seasonally important second half still to come the business is well placed ahead of its peak trading period and we leave our estimates unchanged.”