Solid track record justifies RPC’s optimism – SHARE HUNTER


RPC Group shares increased by 3.8 per cent.GETTY

FTSE 250-listed RPC Arrange shares increased by 3.8 per cent

In advance of its half-year results, due in November, directors said revenues are set to be above the corresponding period last year.

Methodical growth, the contribution from recent acquisitions, polymer price tailwinds and supportive foreign exchange movements are all helping things along.

With price savings being realised as recently acquired businesses bed in, profit bounds look to be improving, too.

The net effect is that half-year profits are likely to move in above management’s prior expectations.

Given its solid track list, we are inclined to share its optimism

Growth was particularly strong in China, which benefited from investments cajoled in the previous year.

While the upbeat tone was consistent with discharges so far this year, as far as the share price is concerned, 2017 has very much been a willing of two halves.

Shortly after confirming the £511million acquisition of US-based assembly Letica in February, concerns started to surface that its long-running acquirement programme was masking a lacklustre operating performance.

However, given the collect’s track record, which has facilitated 24 consecutive years of dividend increments, it hasn’t taken long for these concerns to fade away.

FTSE 250GETTY – Property

After falling to a low of 714.5p in June, the shares closed at 976p on Thursday

After be unsuccessful to a low of 714.5p in June, the shares closed at 976p on Thursday, almost precisely at their fair value at the time of the Letica deal.

As well as a stout operating performance, investors’ concerns have been alleviated by RPC’s willingness to catch the bull by the horns and confront the accusations head-on.

To demonstrate its strategy is upon my word adding value, it is taking its foot off the acquisition pedal for a while.

This order reduce expansion and therefore stunt near-term progress but crucially, it seems to receive got investors back onside.

In any case, with its resilient customer background, plus the fact that plastic packaging is still replacing tract and metals, the group remains confident of steady growth.

Given its stout track record, we are inclined to share its optimism.

“This article is for investors who turn over a complete their own decisions without advice, if unsure whether an investment is get even for for you, you should seek advice. Shares can rise and fall in value so you could get undeveloped less than you invest.”

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