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Highlights

  • CHH’s FY23 saw a 12% drop in sales volumes, but a 12.5% rise in pre-tax profit
  • A 14.3% increase in dividends was finalized with a 25 pence per share payout in June 2024
  • Despite challenges, CHH eyes recovery in H2 FY24 through product enhancements

Churchill China PLC (LSE: CHH) is an English pottery manufacturer. Based in Stoke-on-Trent in England, the company’s two business segments are materials and ceramics. The company has a market capitalization of GBP 129.27mn and is a constituent of the FTSE AIM ALL-Share Index.

In FY23, CHH experienced a 12% decrease in sales volumes, resulting in a marginal 0.2% decline in revenue. Despite these challenges, the company saw a notable 12.5% increase in profit before tax, attributed to improvements in factory operations and yields returning to pre-pandemic levels. Moreover, CHH enhanced its total dividend by 14.3% over the previous fiscal year. This was reflected in the final dividend of 25 pence per share paid on June 17, 2024. Additionally, the net cash inflow for the year surged by approximately 69.4%.

Recent business update

According to the company's Annual General Meeting (AGM) statement issued on June 5, 2024, CHH's trading performance has met management's projections. Additionally, productivity and yield have shown continued improvement, driven by increased manufacturing activity.

Company outlook

CHH demonstrated enhanced operating profit and margins throughout FY23 despite stagnant revenues and notable hurdles, especially within the hospitality sector. The decline in volumes year-on-year was primarily attributed to subdued demand in the latter part of FY23. As CHH moved into H1 FY24, this downward trend in demand persisted, with Q1FY24 reflecting anticipated levels.

Looking forward, CHH anticipates a rebound in H2 FY24, driven by ongoing enhancements to its product portfolio and strengthened market positioning.

Top 10 shareholders

The top 10 shareholders in the company together account for approximately 67.32% of the total shares outstanding. Investec Wealth & Investment Limited holds the largest portion of shares at around 11.24%, followed by Roper (James Andrew) with approximately 8.40% ownership, as illustrated in the chart provided below:

Stock performance

Over the past month, CHH's stock has shown an increase of approximately 7.27%. However, over the preceding six months, it has experienced a decline of about 14.18%. The stock's 52-week range spans from a low of GBX 947.00 to a high of GBX 1,500.00, with its current trading price positioned below the midpoint of this range.

Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference data for all price data, currency, technical indicators, support, and resistance levels is 08 July 2024. The reference data in this report has been partly sourced from EODHD/Others.

 

 

 

 

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