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Thursday tips round-up: Bunzl, Direct Line, Real Good Food

Thu, 27th Jun 2013 06:36

Bunzl is a boring investment but in these markets, boring is good, according to The Times' Tempus column.As a note from Numis Securities on Wednesday highlighted, there is little that is boring about a share price that has risen by 25 times over 23 years. The latest trading statement from Bunzl also suggested there was little to hinder growth in revenues and profits.Bunzl, which distributes a range of disposable products including toilet rolls and plastic cutlery, has seen underlying growth come in at above the level of gross domestic product growth."So what is there not to like? Bunzl shares, off 10p at £12.46, sell on a hefty 16 times earnings, high for such a mundane business, and the yield, at 2.5% is not much to speak about. Still, this is a great defensive stock to hold in these times," Tempus said.Those involved in the floatation of insurer Direct Line last October are likely to be looking back with satisfaction as shares are up by almost a third on the offer price and have outperformed rivals Admiral and RSA, the Financial Times' Lex column reported. But the shares are at a discount to Admiral, partly reflecting an overhang and higher costs at Direct Line. Operating expenses were 26% of gross premiums last year so it came as little surprise that Direct Line's shares jumped 4.0% on Wednesday as the company announced another round of cuts. The latest cuts, which will mostly come from reducing its headcount, will bring costs down to £1.0bn. "The cost line is important because advances in premium income cannot be taken for granted," Lex said. "If revenue growth is not going to sustain Direct Line's impressive start, the heavy lifting will have to come from further down the profit and loss account."Real Good Food (RGF) has sales of more than a quarter of a million pounds but a market capitalisation of less than £30m. The Times's Tempus said the reason for that may be because it is making wafer-thin margins and is overlooked by the market. The company, which owns the Whitworths sugar brand and supplies cakes and patisserie to Waitrose, is undergoing a reorganisation in an effort to double its turnover within three years. A year ago the company made a deal with the largest producer in Mauritius, which raised its stake to 20% and secured supplies. This combined with a new import facility in Britain will mean an additional £350m to £400m of turnover by 2015-16. "In all this, the results for the year to the end of March are a work in progress," Tempus said. "RGF is not followed much by analysts, but this could change if those growth plans bear fruit. For now, the shares sell on a paltry six times earnings. Potentially interesting, if not for the risk-averse."RDPlease note: Digital Look provides a round-up of news, tips and information that is impacting share prices and the market. Digital Look cannot take any responsibility for information provided by third parties. This is for your general information only as not intended to be relied upon by users in making an investment decision or any other decision. Please obtain a copy of the relevant publication and carry out your own research before considering acting on any of this information.

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3 Dec 2013 09:23

Soggy bottom line for Real Good Food as costs and sugar prices weigh

First-half profits plummeted at ingredients specialist Real Good Food as it suffered from a dramatic drop in EU sugar prices and continued its reorganisation. Higher costs meant that profits plunged 90% to £0.1m on sales down 5.6% to £130.1m in the six months to September 30th, meaning a soggy bott

10 Oct 2013 10:34

Real Good Food Company's sugar unit wins supply deals with Asda, Booker

The Real Good Food Company said its sugar specialist Napier Brown had won major new supply contracts from grocer Asda and wholesaler Booker for its Whitworths sugars range. The deals will double the retail value of Whitworths sugar sales and create about 80 new jobs at Napier Brown's headquarters i

10 Oct 2013 07:27

Real Good Food's Napier Brown Wins Sugar Contracts With Asda, Booker

12 Sep 2013 08:39

Real Good Food hits first half targets

UK bakery, ingredient and sugar group Real Good Food said trading during the first half of its financial year has been in line with company expectations. In June, the Liverpool based group announced a positive trading performance for the 12 months ended March 31st 2013, following improved profitab

20 Mar 2013 07:20

Final quarter pick up for Real Good Food

Sugar and ingredients firm Real Good Food Company said, following a difficult third quarter, trading in the final quarter to March has been encouraging with a large positive swing in EBITDA. The rise in EBITDA was due to a stronger sugar trading quarter, combined with the turnarounds achieved at Ha

31 Dec 2012 08:26

London open: Stocks fall ahead of fiscal cliff deadline

The Footsie opened firmly in the red on Monday morning with just one day to go before the automatic spending cuts and tax increases in the US come into effect. Without a deal by politicians Stateside to avert the so-called fiscal cliff by tomorrow, analysts expect the US economy to plunge back into

31 Dec 2012 07:54

Real Good Food completes five year banking facility

Sugar and ingredients firm Real Good Food Company confirmed that it has completed a new five year 50m pound bank facility with its current financiers PNC Financial Services UK ahead of the maturity of its existing facilities in July 2013. The new facility which, represents a £10m increase on the e

13 Sep 2012 07:50

Real Good Food confident of strong quarter

UK bakery, ingredient and sugar group Real Good Food said the current year has started well, with a strong first quarter, a flatter second quarter, and early indications suggesting a seasonally-strong third quarter. The Liverpool based sugar producer added that is on track to meet market expectatio

24 Aug 2012 16:24

SDL non-exec takes up only holding in firm

Mandy Gradden, a non-executive director of SDL, the FTSE 250 information management firm, bought up 7,500 shares on Thursday, just over a week after the company unveiled a 20 per cent leap in first-half revenues. Gradden's purchase, in which she bought the shares at 658p each for a total of £49,35

17 Aug 2012 16:12

Bostock reduces stake in Marks and Spencer before exit

Kate Bostock, who is quitting her role as Executive Director of General Merchandise at Marks and Spencer, has taken advantage of the recent rise in the retailer's share price with a double sale of shares late on Thursday. Bostock, who announced her exit in July but will stay on until October, sold

4 Jul 2012 16:31

Electrocomponents directors ditch shares awarded in bonus plan

The Chief Executive Officer (CEO) of FTSE 250 electronics and maintenance products distributor Electrocomponents has, alongside the group's Finance Director, sold off a number of shares awarded under the company's deferred bonus plan. CEO Ian Mason earned himself £100,554 after selling 48,460 at 2

3 Jul 2012 07:05

Real Good Food lifts sales

Liverpool based sugar producer the Real Good Food Company lifted sales for the 15-months to end March following a robust performance from Renshaw and Garrett Ingredients. Revenue for the 15-month period increased to £305.5m from £249m for 12 months to 31 December 2010. EBITDA jumped 62% to £9.1m

18 Jun 2012 08:09

Mauritian firm ups stake in Real Good Food

Mauritius outfit Omincane is to increase its stake in theReal Good Food Company (RGFC), which owns a portfolio of sugar, bakery and patisserie firms. Omincane is paying 60p a share, a 9.1% premium to the closing price of RGFC on the trading day before the announcement, to increase its holding in th

20 Mar 2012 08:16

Real Good Food revenues and profit jump

UK bakery, ingredient and sugar group Real Good Food reported a year-on-year rise in both revenue and pre-tax profit in the second half of 2011. Profit for the six month period rose from £3.2m to £4.2m on revenues of £139.3m compared to £109.4m the same period the previous year. Gross profit rose

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Thursday tips round-up: Bunzl, Direct Line, Real Good Food

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