Blackmores Limited reports record half-year profit: Is it a bargain?

Leading natural health product developer, Blackmores Limited (ASX:BKL) has reported a promising set of half-yearly results.

| More on:
a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Leading natural health product developer, Blackmores Limited (ASX: BKL) has today seen its share price trend higher following the release of its interim results.

In the six months to 31 December 2014, Blackmores achieved both record revenue and net profit after tax with all regions and brands contributing to the result.

For the half, revenue came in 22% higher at $206.4 million, whilst NPAT was an impressive $18.6 million, up 54% on the prior corresponding period.

In addition to a falling net debt position (from $54.4 million to $36.7 million) the company announced an interim dividend of 68 cents per share, up 55%. The dividend is payable on 13 April 2015.

Commenting on the results, CEO Christine Holgate said, "This is a very encouraging result that was achieved with all regions and brands in the Blackmores Group delivering strong year on year growth. It has positioned us well for the second half whilst enabling us to build a strong balance sheet."

She also said, "Importantly, we are delivering against our four key strategic priorities: to be increasingly consumer centric and grow our Australian business; invest in growth in Asia; leverage knowledge within the Blackmores Institute and drive further product innovation; and improve our operational effectiveness."

Whilst Blackmores Asia was held back by retail challenges in Thailand, leading to a decline in earnings before interest and tax (EBIT) of 15%, the establishment of a free trade zone in China last November coupled with a stronger balance sheet put the group on a good footing moving forward.

Today the company announced it had elected two new managers within its Asia Business, Ms Pussadee Suchitchon and Ms Jin Young Kim.

It also announced the appointment of Chief Financial Officer (CFO), Aaron Canning. Mr Canning replaces Chris Lang who stood down as CFO and Company Secretary.

Should you buy Blackmores shares?

At today's price of $43.21 per share, Blackmores trades on a forward price-earnings ratio of 21 and dividend yield of 3.5%. Whilst that multiple may appear expensive at first glance, analysts are forecasting solid earnings per share growth over the next three years. Therefore it may be worth adding to your watchlist.

Motley Fool Contributor Owen Raszkiewicz does not have a financial interest in any of the mentioned companies. Owen welcomes your feedback on Google plus (see below) or you can follow him on Twitter @ASXinvest.

More on ⏸️ Investing

Close up of baby looking puzzled
Retail Shares

What has happened to the Baby Bunting (ASX:BBN) share price this year?

It's been a volatile year so far for the Aussie nursery retailer. We take a closer look

Read more »

woman holds sign saying 'we need change' at climate change protest
ETFs

3 ASX ETFs that invest in companies fighting climate change

If you want to shift some of your investments into more ethical companies, exchange-traded funds can offer a good option

Read more »

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
⏸️ Investing

The Michael Hill (ASX: MHJ) share price poised for growth

Investors will be keeping an eye on the Michael Hill International Limited (ASX: MHJ) share price today. The keen interest…

Read more »

ASX shares buy unstoppable asx share price represented by man in superman cape pointing skyward
⏸️ Investing

The Atomos (ASX:AMS) share price is up 15% in a week

The Atomos (ASX: AMS) share price has surged 15% this week. Let's look at what's ahead as the company build…

Read more »

Two people in suits arm wrestle on a black and white chess board.
Retail Shares

How does the Temple & Webster (ASX:TPW) share price stack up against Nick Scali (ASX:NCK)?

How does the Temple & Webster (ASX: TPW) share price stack up against rival furniture retailer Nick Scali Limited (ASX:…

Read more »

A medical researcher works on a bichip, indicating share price movement in ASX tech companies
Healthcare Shares

The Aroa (ASX:ARX) share price has surged 60% since its IPO

The Aroa (ASX:ARX) share price has surged 60% since the Polynovo (ASX: PNV) competitor listed on the ASX in July.…

Read more »

asx investor daydreaming about US shares
⏸️ How to Invest

How to buy US shares from Australia right now

If you have been wondering how to buy US shares from Australia to gain exposure from the highly topical market,…

Read more »

⏸️ Investing

Why Fox (NASDAQ:FOX) might hurt News Corp (ASX:NWS) shareholders

News Corporation (ASX: NWS) might be facing some existential threats from its American cousins over the riots on 6 January

Read more »