Tyman earnings firmer as it eyes tougher year ahead

International supplier of engineered components to the door and window industry Tyman announced its preliminary audited results for the year to 31 December on Wednesday, with revenue rising 29% to £457.6m, or 1% on a constant currency, like-for-like basis.

The London-listed firm’s underlying operating profit was £69.8m for the year - a 36% improvement on 2015, or 5% on a constant currency, like-for-like basis.

Its underlying operating margin was ahead 70 basis points to 15.4%, and its underlying profit before tax was up 38% - or 5% on a constant currency, like-for-like basis to £62.1m.

Underlying earnings per share were up 32% to 25.41p, with the board confirming a 20% increase in dividends per share for the year to 10.5p.

Its underlying net debt worsened by 112%, however, to £176.6m.

The company’s leverage was up at 1.89x, compared to 1.35x in the prior year, and its return on capital employed was ahead 130 basis points at 13.8%.

“2016 was a further year of profitable growth for Tyman assisted by the completion of strategic acquisitions and the benefit of favourable exchange rates, underpinned by strong cash generation,” said chief executive Louis Eperjesi.

“The continued improvement in margins by the divisions is evidence of the quality of our businesses and their leading market positions.”

Eperjesi said the acquisitions of Giesse and Bilco filled two significant gaps in Tyman’s product portfolio, bringing the group a high quality hardware brand for European markets and a meaningful presence in US commercial for the first time.

“On a smaller scale, the acquisition of Response has extended our electronic access capabilities in the UK.

“Progress on integration has been rapid and as a result both Bilco and Giesse will deliver their targeted synergy objectives by the end of 2017 - significantly ahead of schedule.”

Eperjesi explained that 2017 started in line with the board’s expectations across each of its divisions.

“We expect that US residential and commercial markets will be stronger this year than they were in 2016.

“We expect to see a continuation of the gradual recovery in European markets however UK markets are likely to remain variable given lower levels of housing transactions and probable declines in real incomes.”

The board also expected that input costs would increase in the majority of its markets in 2017, and it was looking to manage input cost inflation where it arises through effective purchasing, price management and cost reduction programmes, Eperjesi added.

“Our self help initiatives across each of our divisions, together with good visibility of synergy opportunities, means Tyman is well positioned for further progress in 2017.”