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Sprue Aegis PLC Reveals Record Results, But Drops On Profit Warning

The share price of Sprue Aegis (LSE: SPRP), which makes smoke detectors, carbon monoxide detectors and other home safety products under brands such as FireAngel, AngelEye, SONA and Pace Sensors, is currently down 15%. The fall follows release of the company’s final results for the year ended 31 December 2014, in which Executive Chairman Graham Whitworth warned that whist revenue for 2015 is anticipated “to significantly exceed market expectation”, pre-tax profit for the year is expected to come in “marginally below market expectations”, owing to gross margins being adversely affected by Sterling’s continuing strength against the Euro.

The sharp fall comes despite Sprue reporting a record performance for 2014, with a 36% surge in revenue, up to £65.6m, and record reported operating profit, which was up 88%, at £9.6m. And at like-for-like exchange rates with 2013, group profit for 2015 would have been approximately £1.7m higher.

Basic earnings per share (EPS) rose 62%, to 18.8p, and the board is recommending a final dividend of 6p per share. Conbined with Sprue’s maiden interim dividend of 2p per share, that would represens a 33% increase in the total dividend, taking it to 8p per share.

Operational highlights from 2014 include move from ICAP Securities & Derivatives Exchange (ISDX) to AIM on 30 April 2014 and raiing £8m from a placing of new shares, securing  exclusive European distribution rights over BRK Brands’ products and brands on improved terms until at least 31 March 2018, and the company’s French market” significantly out-performing management expectations”.

Commenting on the results Graham Whitworth said:

Sprue’s mission remains to protect, save and improve our customers’ lives by making innovative, leading edge technology simple and accessible. It is a simple philosophy. At the same time, we remain focussed on driving shareholder returns and will continue to invest in our product base and technology and with Nick Rutter [a co-founder] devoting more time to drive this initiative, we will continue to enhance our market leadership position in each of the markets in which we operate.”

Despite this morning’s fall, at 290.5p, Sprue’s share price is up 35% on this time last year, during which time the AIM All-Share index has fallen 8%.

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Jon Wallis has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.