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Plastics Capital PLC - Organic growth Accelerates

Plastics Capital PLC (LON:PLA) has reported a strong set of results for the financial year ended March 2018. Revenues of £76.7mln and earnings per share (EPS) of 9.5p are both slightly ahead of our forecast, which was last updated at the time of the detailed Plastics Capital trading update on May 2.
Plastics Capital PLC - Organic growth Accelerates

The most important headline metric, in our view, is the organic (like-for-like) revenue growth of 13.0%, which reflects a strategy shift undertaken last year to focus more on top-line growth.

During the last two years, Plastics Capital has undertaken a significant programme of investments - £4.1mln in FY Mar2018, including £1.8mln of investment in new capacity. The benefits are evident in the FY Mar2018 revenue growth, and we believe that earnings will begin to follow from FY Mar2019 onwards. We believe that the current valuation at a Mar2019 price/earnings ratio of 9.3x represents an interesting entry point in light of these growth dynamics.

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April 26 2019

Synnnovia PLC (LON:SYN) has released a trading update for the year to 31 March. The company continues to expect significant growth in revenue and profits, with progress remaining strong in the higher margin Industrial division.

However, profitability for the group as a whole will now be below previous expectations. Previously reported delays in new projects in the Films division were resolved as expected, but the catch-up during January-March has not been strong enough to offset the impacts on profits. Also within Films, there have been some cost escalations affecting profitability for the division.

The company has also announced that it will publish some revisions to previously reported revenues, with the adjustments being described as "non-material".

We are now forecasting revenue growth of 7% and earnings per share (EPS) growth of 2% for the full year (FY) to March 2019. Our new forecasts are below our previous forecasts by 2.4% at the revenue level and 7% at the EPS level.

For FY March 2020 we are lowering our EPS forecast by 12% but are still forecasting 18.6% EPS growth versus FY March 2019. Our new forecast assumes 1) delays in Films are resolved, 2) growth in both divisions, 3) growth will be partially offset by the cost escalations in Films.

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December 03 2018

Plastics Capital (LON:PLA) has reported first half  (H1) results to September 2018 showing revenue growth of +11.4%, underlying earnings (EBITDA) growth of +42.8%, and adjusted earnings per share (EPS) growth of +67.9%. These results reinforce our confidence in our full-year (FY) March 2019 forecasts, including our EPS growth forecast of 25.3%.

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February 27 2019

Synnovia (LON:SYN) released a trading update on 19 February, confirming that trading in the full year (FY) to 31 March is broadly in line with expectations. We continue to forecast growth in revenue and earnings; however, we are lowering our FY earnings per share (EPS) forecast from 11.9p to 10.4p to reflect a slower increase in profit margins due to operating issues in the Films division.

Both the Films division and the Industrials division continue to deliver organic growth, and we believe the group is well positioned for growth in FY March 2020. Some details of the divisional dynamics are included on p2.

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