Dull business but cracking chart, great dividend and ad hoc takeover rumours. I'm happy to settle for that kind of dull!

StockMarketWire.com
Fenner's underlying operating profits rose by 59% to £59.1m in the year to the end of August.

Revenues were up 14% at £655.4m and the group posted an operating profit of £53.4m compared with a loss of £14.7m last time.

Other highlights:
- Underlying pre-tax profit of £45.3m (up 95%) and underlying earnings per share of 17.7p (up 111%)

- Free cash flow of £69.0m (up 78%); net debt of £101.5m (2016: £150.0m), representing 1.2 times EBITDA

- AEP like-for-like revenue up by 11%; underlying operating profit of £43.9m (up 29% at constant currencies)

- Increased final dividend of 2.8p (up 40%) making total dividend for the year of 4.2p

Chief executive Mark Abrahams said: 'The group's results for 2017 show significant improvements over the previous year on all measures.

'These improvements illustrate the strength of the group's responses to the difficult trading conditions faced by the group in many of its principal markets over recent years and particularly reflect our continuing commitments to customer service, product development and operating efficiency.

'As we enter the new year, the outlook is strengthening.

'The group's momentum is being maintained with each of our businesses seeing opportunities and encouraging developments.

'We believe the coming year will see further progress across the group, notwithstanding the significant macro-economic uncertainties around the world.

'Overall, given the structural growth opportunities that the group has created, the board anticipates that the outcome will be above its previous expectations.'

Citigroup today reaffirms its buy investment rating on Fenner PLC (LON:FENR) and raised its price target to 425p (from 400p).

StockMarketWire.com
Fenner expects operating income for the current financial year to be about its previous forecasts, according to update issued ahead of today's annual general meeting.

The group said it had a robust start to its financial year as it continued to transition from recovery to sustainable growth.

It said all businesses were performing well, with generally increasing order intakes and further benefits from on-going efficiency enhancements.

It said: 'The board envisages that, due to the recent increases in order intake in ECS, the consistent strength of AEP and the general strengthening of trading across the group, Fenner will achieve an operating outcome for the current financial year which is above its previous expectations.

'Looking beyond the current year, the group's strengthening market positions, an increasing expectation of the returns from its on-going investment in product development, the reduced US tax rate and the depth of expertise across the group's management team make the board increasingly confident about the future progress of the group.'

Anyone still holding this?

Bid today.

I bought at 196 and sold at 285. I thought I did well at the time!

Sadly not CC. Have dipped in & out over the years, but missed the surge this time.
No info on the bidder yet.

Correction.....looks like Michelin.

UBS comment:
"In multiples it equates to 13x 2018E EBITDA, 18x EBITA (August year end). This falls to 12x and 15x respectively on our 2019E forecasts. This looks high versus the 7-8x EBITDA paid by Continental for Veyence a few years ago, but reflects in our opinion the higher growth profile of the AEP business at Fenner. The valuation being paid is in line with multiples paid for other UK engineers that have been acquired in recent years. In the context of Fenner having traded at an average 20-25% sector discount over the last decade this could seem a generous multiple. However, we would note that our 2018E EBITA is still only c70% of the 2012 peak profits and even if the past ECS peak may not be repeatable we do see further strong improvement forecast to 2020E.

We do not foresee any competition or regulator related barriers. The other question is whether there could be a counterbid at all?
While there are companies that could have a strategic fit with Fenner's divisions individually it is not obvious to us that there is a third party that would have the same strategic logic to bid for the whole group."