There was another excellent Trading Update from SDI Group yesterday, which has seen the shares moving northwards again to a current £2.14p.
In wake of that, I have caught up with CEO Mike Creedon once more for some additional colour on the current picture and further potential acquisitions.
Creedon is as usual on form and sounds both satisfied and pleased with the progress, stating that he feels that they are doing alright, across the group.
That may sound like something of an understatement with a highly impressive organic growth performance anticipated and where revenues and profit are expected to be very strong for the full year outcome.
Within that context, Creedon tells me that all the businesses are doing their bit and there are obviously some strong synergies now playing out, such as the Gallenkamp offering now being pushed across the wider group in order to create another revenue stream.
Monmouth Scientific, which has returned to its more normal non Covid related business, continues to do well and the CEO tells me that the new larger premises is now up, with Monmouth expected to move in early next year.
He also tells me that Uniform Engineering is now installed within the Monmouth operation as previously highlighted and is also playing its part.
Other businesses are naturally being pushed for growth with MPB Industries another which benefited from the Covid ventilator project also responding well.
Additionally, Astles, Applied Thermal Control and the Graticules arm have all recovered well from the pandemic issues of last year and are each trading positively.
All in all, the various businesses look in excellent shape and despite the obvious supply chain issues inflicting many across the economy, Creedon says that they are coping well with that situation.
Within the update the company also revealed that it had expanded its banking facility to £20m with a further £10m option at the bank’s discretion.
No doubt investors eyeing that piece of news will be wondering as to whether SDI now has its eyes on a much larger and meatier acquisition than has been the case to date.
Creedon quickly dismisses that train of thought and tells me that it is going to be a case of sticking to what has thus far delivered for shareholders and what they are comfortable with.
This isn’t the first time the CEO has confirmed as much on this area and he adds that he continues to look at niche, cash generating targets on similar multiples as have been achieved to date and in the same area of cost bracket.
At present, without divulging too much, he tells me that he is continuously focused on potential additions and although no timeline on bringing these into the fold is given, he is nonetheless confident of being able to deliver on at least one by the end of the current financial year.
Broker FinnCap has, following the update raised its adjusted pre-tax profit by 3% for the full year 2022 to £9.2m on expected revenues of £45m with adjusted EPS of 6.6p.
Looking further ahead as the ATIK Covid related business comes to an end as previously highlighted by the company, then the numbers at present look set for a reduction in 2023.
However, further acquisition’s look merely down to timing now, so with one or two of those looking likely to provide a revenue and earnings boost, plus continued progress from existing businesses, then one would assume that the current 2023 numbers will at some point be revisited.
As is always the case and a welcome one too, Creedon tells it as it is with caution being a watchword, where to that end, investors here should feel very comfortable with the prevailing picture and the share price performance.