Photo-Me shares a ‘buy’ as the group reports robust international progress

Otmane El Rhazi from Mindful Money » Shares.

As Photo-Me reports its fourth quarter numbers, Graham Spooner, investment research analyst at The Share Centre, explains what it mean for investors…

Surrey based photo booth and laundrette company Photo-Me International posted its fourth quarter earnings results. Highlights included a 16.3% rise in full-year underlying pre-tax profit and a dividend increase of 30% to 4.88p pence. The group also reported that it is expanding into South Korea and Poland. This is whilst its new laundry machine venture is progressing well in France and Belgium.

The results, which were good, were held back by the strength of sterling against the euro and yen, and this may have an adverse effect in the year ahead. Potential investors will be pleased to see that, as well as increasing the dividend by 30%, the group plans to increase the ordinary dividend by 10% per annum.  Any net cash on the balance sheet in excess of £50m will also be made available to shareholders as a potential special dividend.

We are currently recommending the group as a ‘buy’ for higher risk investors looking to achieve a higher level of income, alongside the chance of further growth from its expansion into new countries and introduction of new products.