Michelmersh sees full-year results in line with market views

In an update ahead of its final results for the year to the end of December 2018, the AIM-listed company said it experienced a good operational performance in the final quarter following planned maintenance shut downs and the board continues to focus on identifying further earning-enhancing opportunities.

"The board expects that underlying revenue and profit from the group will be in line with market expectations with strong cash generation resulting in year-end net debt below forecast," it said.

Canaccord Genuity, which rates the stock at 'buy' with a 95p price target, said this was a "solid" pre-close trading update.

"Given the comments in the update we remain comfortable with our forecasts: we expect underlying earnings growth of circa +40% and EBITDA of £10.9m, boosted by acquisitions and a strong trading backdrop. We would also expect net debt to come in lower than our forecast of £13.5m.

"No comment has been made on the outlook for 2019 which is understandable at this early point in the year. As set out in our recent initiation note, at this stage we expect earnings to edge back in 2019 before seeing further growth in 2020."

At 1110 GMT, the shares were up 0.3% to 76p.