DJ Edison Investment Research Limited: S&U (SUS): Seeing recovery and adapting to grow
Edison Investment Research Limited Edison Investment Research Limited: S&U (SUS): Seeing recovery and adapting to grow 04-Apr-2022 / 07:00 GMT/BST
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London, UK, 4 April 2022
S&U (SUS): Seeing recovery and adapting to grow
S&U recorded a dramatic increase in profit in FY22, but the more telling point is that average pre-tax profit for FY22 and FY21 was nearly GBP33m, only slightly below the pre-pandemic level of GBP35m (FY20). In the meantime, the group has continued to refine and develop both its businesses, which should underpin medium-term growth even if the near-term macro background is uncertain.
Our estimates are increased slightly, with EPS raised by 2% and 3% for FY23 and FY24 respectively. Following the exceptionally low level of loan loss provisions in FY22 we expect a normalisation in FY23, hence the reduction in pre-tax profit between the two years, from GBP47m to GBP39m. This still leaves the prospective multiple only just above 9x. The disparity between profits and earnings growth in FY24 is the result of allowing for the increase in corporation tax to 25%. The historical and prospective yield of over 5% should be supportive for the share price. Click here to view the full report or here to sign up to receive research as it is published.
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April 04, 2022 02:00 ET (06:00 GMT)
