Tristel

05 November 2020
By Maynard Paton

Results summary for Tristel (TSTL):

• Revenue and profit reached new highs following very satisfactory 20%-plus growth, bolstered in part by the pandemic.

• The UK performance appeared odd, given H2 sales were lower than H1 despite the Covid-19 boost.

• Overseas sales surged 35% during H2, with the purchase of Ecomed during 2018 now proving to be a great success.  

• The accounts remain in good shape with high margins, appealing equity returns, net cash and respectable cash generation. 

• A possible P/E of 39 might be justified if the pandemic leads to permanently greater demand for hospital disinfectants. I continue to hold.

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29 February 2020
By Maynard Paton

Results summary for Tristel (TSTL):

• Bumper first-half figures showed very satisfactory double-digit growth following superb sales increases within the UK and various overseas markets.

• The underlying profit performance was complicated by undisclosed acquisition contributions, US regulatory costs, hefty option charges and cheeky bookkeeping.

• Following these results, the coronavirus outbreak has led to an emergency “special exemption” order from China and prompted “substantial” extra purchases by the NHS.

• The accounts remain in good shape with high margins, net cash and respectable cash generation.

• The valuation has become extremely punchy with an estimated underlying P/E of 43. I continue to hold.

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12 December 2019
By Maynard Paton

Results summary for Tristel (TSTL):

• Record annual figures for the sixth consecutive year, supported by satisfactory progress both within the UK and abroad.

• The underlying performance was complicated by Brexit stock-piling, an acquisition, US regulatory costs and option expenses. 

• The publication of new three-year financial targets was impressive, and suggested the company could grow organically at 10-15% per annum. 

• The accounts are still healthy with high margins, net cash and respectable cash generation. 

• The valuation remains understandably rich with an estimated underlying P/E of 30. I continue to hold.

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04 September 2019
By Maynard Paton

Trading update and presentation summary on Tristel (TSTL):

• TSTL’s 2019 open-day presentation and the associated scuttlebutt did not yield any ground-breaking news. 

• Unpicking the accompanying trading update suggested second-half UK sales gained an impressive 12%.

• However, the contribution from international operations was distorted by the purchase of Ecomed in November.

• The former Ecomed boss was confident sales in France could one day exceed those in Germany — TSTL’s largest overseas market. 

• The purchase of the group’s Italian distributor — which has expanded quickly during recent years — appears very sensible. 

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28 February 2019
By Maynard Paton

Results verdict on Tristel (TSTL):

• Very satisfactory double-digit growth supported by encouraging progress both within the UK and abroad.

• A new product and a recent acquisition offer attractive medium-term potential.

• Continued bungling of the US regulatory project raises awkward questions about the associated consultants and decision-makers.

• Accounts remain in good shape with high margins, net cash and conservative reporting of ‘one off’ costs.

• Valuation remains understandably rich with an underlying P/E of 26. I continue to hold.

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26 October 2018
By Maynard Paton

Update on Tristel (TSTL).

Event: Final results for the twelve months to 30 June 2018 published 17 October 2018 and shareholder presentation hosted 18 October 2018.

Summary: I was broadly satisfied with these full-year figures, which set new records for revenue, profit and the dividend. However, the statement and City presentation provided numerous little niggles — not least a bizarre management decision that has delayed product approval within the United States for a further six months. Still, TSTL’s collection of medical disinfectants continue to produce attractive accounts and perhaps their biocidal qualities have been underlined by recent deals with the NHS and Parker Laboratories. I continue to hold.

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20 July 2018
By Maynard Paton

Update on Tristel (TSTL).

Events: Trading update for the year ending 30 June 2018 published 13 July 2018, director share sales published 16 July 2018 and shareholder open-day presentation hosted 17 July 2018.

Summary: Earlier this week I attended TSTL’s third annual open day, and this year the event was accompanied by news of hefty director selling as well as confirmation of record revenue and profit. The chairman has reduced his shareholding from 19% to 15%, and confirmed he is looking to sell more during the next few years. The marquee presentation did not provide any great revelations, but one slide did show a useful sales comparison between the UK and overseas, while another slide suggested full-year sales of the group’s ‘core’ disinfectants had just advanced an impressive 18%. I continue to hold.

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23 February 2018
By Maynard Paton

Update on Tristel (TSTL).

Event: Interim results and shareholder presentation for the six months to 31 December 2017 published 20 February 2018

Summary: These first-half figures were slightly better than I had expected, with December’s AGM statement having downplayed the group’s underlying progress. Welcome revenue advances — both in the UK and abroad — were delivered by TSTL’s main disinfectant products, while adjusted profit would have soared 24% were it not for the costs of entering North America. Sadly it remains anyone’s guess as to when those costs will eventually see any payback. Nonetheless, the first North American milestone is looming — an EPA product approval decision is expected on 16 April, and the share price is optimistic. I continue to hold.

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25 October 2017
By Maynard Paton

Update on Tristel (TSTL).

Event: Final results and shareholder presentation for the year to 30 June 2017 published 19 October 2017

Summary: July’s trading statement from this medical disinfectants specialist had already signalled these record results. However, the update showed underlying revenue growth of just 7%, with the UK up 3% and overseas up 10%. I’ve therefore had to delve deep into the numbers to ensure TSTL’s main products continue to sell relatively well. At least the company’s accounts and recent acquisition showed more obvious appeal. I must confess, I am nervous comparing the share-price valuation against the medium-term expansion potential, especially with the prospect of sizeable North American revenue as distant as ever. I continue to hold.

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26 July 2017
By Maynard Paton

Long update on Tristel (TSTL).

Event: Shareholder open-day presentation and trading update for the year ending 30 June 2017 published 19 July 2017

Summary: Similar to last year’s open day, this was a very useful shareholder event that accompanied a better-than-expected trading update. However, I thought the lack of any reference to UK revenue was odd and I await October’s full-year results for the finer details. For now at least, the disinfection specialist appears on course to meet its three-year targets and there are some promising developments with the planned venture into North America. Plenty of optimism, though, appears to be priced into the shares. I continue to hold. 

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02 March 2017
By Maynard Paton

Quick update on Tristel (TSTL).

Event: Interim results, City presentation and investor webinar for the six months to 31 December 2016 published 23 February 2017

Summary: These first-half figures were slightly better than I had expected, with the finer details confirming December’s AGM statement had downplayed the group’s underlying progress. Impressive 20%-plus revenue advances — both in the UK and abroad — were delivered by the group’s main medical disinfectant products, while adjusted profit would have soared 29% were it not for the costs of entering North America. Sadly it remains anyone’s guess as to when those costs will first see any payback. Nonetheless, TSTL remains on course to meet management’s ambitious three-year growth projections… and the shares are priced accordingly. I continue to hold.  

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