Findel (LON:FDL) (9.25p and 3% of JIC portfolio) has issued an encouraging trading statement covering the 16 weeks to 22nd January. Total sales over this period are up 10.2% which is a healthy increase on the 7.7% achieved in the first 8 weeks of the period. For the year as a whole, i.e. since 31st March 2012, group sales have increased by 8.9%.
The stand out performance is at its largest business Express Gifts where sales were up 13.3% since the 30th September, driven by an 8% increase in active customers over the year and supported by a reduction in gross margins. The Company says that it expects Express Gifts to deliver a significant improvement in profits for the year as a whole and that bad debts have remained stable.
The remainder of the business are a bit of a mixed bag: Kleeneze continued to struggle with sales down 9.1% year on year as the number of distributors fell 10.3%. Kitbag saw sales up 19% with a 2% improvement in gross margin. Education supplies saw total sales down 1.6%, although management say that there was an encouraging growth in the core business offset by the shortened duration of Sainsbury's "Active Kids" scheme. The Healthcare division saw sales 21% ahead. Discussions regarding the sale of this division are progressing.
Overall the Group seems to be making good progress both operationally and on improving the balance sheet. I think there is scope for some upgrades to existing forecasts which value the shares at 10.2x for the year to March 2013, 7.3x March 2014, (40% growth) and 6.1x March 2015, (20% growth). I increased the holding to 3% of the portfolio last week and feel happy with that decision.
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