OYSTERTEC

The profits of £6.7m, which many of you have questioned, are expected for 2004 and not this year.CS dont appear to have revised their forecast for 03 post the trading statement but the original forecast were for profits of £3m and eps of 1.2p.Since they made operating profits of £1.5m and eps of of 0.56 in H1 I can only assume CS were expecting repeat of H1 in H2.The fact that they will exceed expectatations suggests that either sales have been higher in H2 or the margins have improved from measly 2.9% in H1 to perhaps 4%..or both.If we assume a marginal improvement in turnover to say £55m in H2 and an uplift in margins to say 4% in H2 then operating profits should come to 2.2m in H2 bringing the full year profits of £3.7m which equates to full year eps of about 1.47p.

For 04 it is not unreasonable to assume turnover rising by 10% to £118m from £107m in 03 and margins rising to modest 6%..specially as they are targetting high margin markets.On that basis operating profits would be £7m and eps of about 2.2 post tax...
So Id say CS are not completely out of court with their forecasts given that the assumptions made are fairly conservative..I am prepared to be challenged if anyone dare :o)
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