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Sanderson hikes full-year dividend after delivering robust profit and cash position

Sanderson chief executive Ian Newcombe said there is an “ongoing plan” to accelerate growth with selective acquisitions
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Sanderson counts Hotel Chocolat as one of its retail clients

Software firm Sanderson Group PLC (LON:SND) hiked its 2018 dividend by 13% after delivering strong growth in profits and ending the year with a cash position ahead of market forecasts.

The company, which provides enterprise resource planning software to retail, wholesale and food, supply chain logistics and drink processing sectors, said operating profit in the year to September 30 rose by 33% to £5.18mln.

Revenue jumped 49% to £32.05mln, boosted by supply chain management firm Anisa, which Sanderson purchased in November 2017 for £12mln. Excluding the acquisition, like-for-like revenue edged up 6.5% to £12.17mln.

Profits and revenues were in line with the estimates the company provided in an October trading update.

READ: Sanderson shares jump as it expects full-year results to be ahead of expectations

The group, whose clients include Hotel Chocolat, Joe Browns and Tottenham Hotspur, said all its businesses traded strongly but the digital retail division was the star performer with revenue rising by more than 20%.  

The order book at the end of the year stood at £7.58mln, up from £5.79mln the previous year.

Sanderson had a cash balance of £6.47mln at the end of September, higher than the £6.18mln posted last year.

A final dividend of 1.75p was recommended, bringing the total dividend for the year to 3.0p, compared to 2.65p a year ago.

“Whilst the board is mindful of potential ongoing uncertainty surrounding economic conditions post the Brexit outcome, the board believes that Sanderson is well positioned in its target markets and has good sales prospects, backed by a healthy order book,” said chief executive Ian Newcombe.

“This provides a good level of confidence that, at this relatively early stage of the new financial year, the Group will make further progress and once again deliver trading results which are, at least, in line with market expectations for the year ending 30 September 2019."

Newcombe also said there is an “ongoing plan” to accelerate growth with selective acquisitions. 

Shares rose 9.4% to 93p in morning trading.



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