Scientific Digital Imaging; reassuring trading update

Scientific Digital Imaging (SDI.L AIM All-Share, Market Cap £56m, 57.5p, 4.0% of JIC Portfolio and 0.0% of JIC Top 10) 

Trading update for the year ended 30 April 2019 

Conclusion: A reassuring trading update and given the recent performance of the shares, I think enough to maintain momentum. I think it sounds a measured trading update with it sensibly mentioning investment to support future growth. Looking to forecasts for the current year, which I anticipate will be upgraded after results in July and following further enhancing acquisitions, suggests to me, that it looks good value. On current forecasts, the shares are valued at 17.4x April 2020 earnings for 32% growth. Not surprisingly it passes the Jim Slater ZULU Principle screen on Stockopedia. It is presenting at Mello London tomorrow, and I’m sure it will win some new supporters. Very Happy Holder!  

It says that full-year revenues are expected to be £17.0m which it describes as moderately ahead of expectations. A quick look at ShareScope and Stockopedia show that forecasts were for £16.6m. It says that there was good momentum throughout the year from the companies already in the portfolio. It goes on to say that the four companies acquired between September last year and April, (Fistreem, Thermal Exchange, Graticules Optics and MPB Industries) have delivered a contribution in line with expectations.

Gross margins were in line with expectations and with some ‚Äúmoderate additional investment to support future growth‚ÄĚ the Company expects to report profits in line with expectations.¬†

Ken Ford, Chairman of SDI, commented:

“This has been a good year for SDI; growing the business and delivering on our acquisition strategy, while laying the foundation for further growth in the future.”

Screenshot 2019-05-15 at 07.36.09