Morgan Advanced halves annual profits but reports strong finish to 2014

12th Feb 2015 15:05

Carbon and ceramic products manufacturer Morgan Advanced Materials finished the year strongly after profit before tax exceeded analysts estimates.At the headline level, including restructuring costs and impairments, the group said its pre-tax profit for the 12 months to 31 December fell from £64m to £31.5m, while revenue dropped from £957.8m to £921.7m but rose 1.8% on a constant currency basis.However, trading in the fourth quarter was better than analysts expected, with adjusted profit before tax and earnigns per share much better than our high-end estimate, driven by stronger revenues.The FTSE 250 company has exited its long-term under-performing areas and added its performance in North America was solid, while trading in Europe had been affected by challenging market conditions."Against the back drop of continuing mixed market conditions as we enter 2015, Morgan will continue to focus and invest in its key technology areas to drive differentiation, positive mix shift and sustainable growth potential," said group interim chief executive officer Kevin Dangerfield."This investment in the business combined with a positive order book as we start 2015 gives the board confidence that the group can make further progress in 2015."The company said it has proposed a final dividend of 7.0 pence per share, up on the 6.7 pence paid in 2013, bringing its total dividend for 2014 to 10.9 pence per share from 10.5 pence a year earlier.Analysts at Investec Securities reiterated their 'buy' rating on the stock, on the back of a strong fourth quarter performance and strong marketing position."We continue to believe that Morgan has great potential - based on its technologies and strong positions in diverse markets - and that much of this is still to be realised," Investec said in a note.On Thursday, Morgan Advanced shares closed up 1.36% to 306.09p.