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Luceco - Margin growth drives 8% profit upgrade

September 2023

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

  • Epic Code:
  • LUCE
  • Price:
  • 121p
Major customers such as Screwfix and Wickes, 136.5p, are both seeing improvement in home improvement spending while Barclaycard saw a bounce in DIY activity in June, the first in 14 months. Against this backdrop Luceco has nudged full year guidance towards the top of its range after first half results beat expectations while its order book for Q3 is said to be strong. Luceco expects to report revenues of £101m and operating profit of at least £10.5m (Liberum forecast: £9.1m). Impressively the beat was in spite of a 5.7% like-for-like sales decline reflecting weak RMI activity and was mainly due to strong gross margins (from c.35% in H1 ‘22 to over 38% in H1 ‘23) , reflecting robust pricing and lower costs such as freight and coppe ...

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With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

All material on this website is protected by copyright. You may use Information retrieved from the www.scsw.co.uk website for your own personal non-commercial use which means that you may not sell or copy this information to any third party without prior written consent. ISSN 1358-183X

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