Avon Rubber - Encouraging H219 momentum

In a pre-close statement ahead of Avon Rubber's FY19 year end, management has indicated the strong momentum in Avon Protection continued through H219. Group performance was also supported by an improved trading environment for milkrite | InterPuls and favourable FX tailwinds. As a result, we have increased our FY19 sales growth estimate to 8% which, after a c £2m one-off non cash tax provision release, leads to a 12.4% increase in our EPS estimate. As the company enters FY20, the momentum is encouraging and should be enhanced when the 3M deal is completed. The shares have performed well since the proposed accretive deal was announced and warrant a premium to UK defence peers.

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