Allenby Capital - Character Group - Interims

An attractive and well received product portfolio has generated an improvement in gross margins which, together with cost savings, has resulted in a strong first half performance, in spite of continued tough markets. We believe that our previously prudent FY26 forecasts can be raised substantially, while still maintaining a degree of caution ahead of the important months of July/August. We are raising adjusted PBT for the year by two thirds from £3.0m to £5.0m and the total dividend from 6p to 9p. With continued solid cash generation, strong operational gearing and zero debt we believe the shares, on an EV/EBITDA of 3.5x, are due a much-deserved re-rating.