Strong results, rich rating for Famous Brands: PE 27x, DY 2.7%

Famous Brands shares are among the best performers on the JSE. In the past decade the price has risen 29 fold from 370c to their current level of around R110 (see below for long-term price graph since its 1994 listing). As a result, much is expected from the company Kevin Hedderwick runs and today’s financial results for the year to end February attracted attention. The group benefitted from expanding margins (20% from 18.5%) and double digit revenue growth (12%). Today’s numbers are on the top end of what was released in the trading update two weeks back. The share price is up 23.5% in the past year, pushing the Famous Brands market capitalisation beyond R10bn for the first time (it could breach R11bn today). The stock has a rich rating – after today’s numbers it trades on a dividend yield of 2.7% and a PE ratio of 27 times. Access the full SENS report by clicking here.  – AH

Famous Brands: Financial highlights – Year to end Feb:

* Revenue up 12% to R2.83 billion

* Operating margin at record high of 20.0% up from 18.5%

* Profit before tax up 23% to R567 million

* Headline earnings per share up 20% to 406 cents

* Dividend up 20% to 300 cents per share

* Market capitalisation exceeds milestone R10 billion

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