25 May 2021
By Maynard Paton
Results summary for Andrews Sykes (ASY):
- H2 revenue down 20% and H2 profit down 37% disappointingly confirmed a lower level of pandemic resilience than H1.
- However, the main UK equipment-hire subsidiary apparently delivered a FY 2020 profit only “marginally below” that of FY 2019.
- Commendable ‘going concern’ text revealed a “cautiously realistic” assumption of a “comparable” performance for FY 2021.
- The books remain healthy with robust margins, effective working-capital management and sizeable net cash, although the pension scheme is absorbing extra contributions.
- A possible P/E of 16-17 and yield of 4% do not appear completely outrageous given the appealing financials and potential for further European expansion. I continue to hold.