VOLUTION (FAN) – Industrials
| Price: 658p +7.3% | P/E: 20x |
| Market Cap: £1.3bn | Yield: 1.9% |
Heating, ventilation and aircon group Volution released a pre-AGM trading update to say activity in the first four months of its new financial year was positive with 5% growth in sales on a constant-currency basis.
Add to that 25% growth from last year’s acquisition of Fantech and total sales are up around 30% since the start of August.
The firm also revealed it is buying another Australian HVAC business for an initial outlay of AUD$ 150 million (around £75 million) with a follow-on payment of up to AUD$ 28.9 million (£14.5 million).
Our View
We have a lot of time for Ronnie George and the team at Volution, and today’s update hasn’t disappointed.
Not only does the firm invest heavily in its own R&D, it has a knack of making seriously earnings-enhancing acquisitions, especially in Australia which is becoming an increasingly important part of the business.
All we would say is the shares aren’t cheap here, which probably explains why they have trodden water for the last six months, as earnings catch up with the price, but the trend looks like it’s onward and upward.
Read the press release here: https://www.volutiongroupplc.com/investors
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