STT. One for Ken7 Apr 2006 14:10
STT. Re: SprattykenStraight - BUY
04/04/2006
Recycling containers company Straight, flagged up here as a buy at 192.5p last September, stormed home with stellar numbers for 2005, and looks poised for further exciting growth. For the year to December, turnover almost doubled to £24.3m on the back of continued organic gains and the January 2005 acquisition of Blackwall, its long-time rival. Pre-tax profits more than doubled – surging 112% to £1.5m – sending headline earnings per share up 68% to 12.6p.
Swiftly integrated, old enemies became firm friends, with Blackwall consolidating Straight’s position as the UK’s leading supplier of kerbside recycling containers, home compost containers and water butts. In the core waste and recycling container market major new contracts were won, but repeat business from existing Blackwall and Straight customers was another key feature of 2005.
Profits at the traditionally low-margin wheeled bin business span higher, thanks to better buying and selling. General recycling containers for the B2B market rose in both sales volume and profits, and garden product revenues also grew on the back of record deliveries of home compost bins to WRAP (Waste & Resources Action Programme).
Overall, growth prospects look good given recent publication of the Draft Waste Strategy from DEFRA, which should lead to rising recycling targets requiring Straight-type container solutions. Investors were also treated to an im