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Shanks H1 results
Waste processing company Shanks, reported half year results today with a 3% decline in revenue knocking 16% off trading profit and 5% off EBITDA.
Almost every significant business shrank, apart from PFI contracts in the UK, and these, surprisingly, are not that profitable.
Operating cash flow (£44m) is well up on an year ago (£14m) and is better than two years ago (£36m) as well.
Gross margin has shrunk slightly, and overheads have risen despite cuts in head office expenses.
The company’s own free cash flow number has turned positive: £14m from -£11m last year. This is smaller than the improvement in operating cash flow.
With an underlying EPS of 3.3p for the half year, the Shanks is on a prospective PE of around 12× at the current price of 86p.
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