LONDON -- The shares of Victrex (VCT 0.32%) advanced 5% to 1,708 pence during early London trade this morning after the specialist plastics developer revealed a marginal improvement in half-yearly profits to £35.1 million
Victrex, which produces a virtually unique highly durable plastic called "PEEK", said European sales volumes were 8% ahead of last year.
The company benefited from a 5% improvement in sales of its light-weight PEEK components to the automotive and aviation industries. However, revenues from Victrex's "Invibio" medical division dropped 5% for the period, due to customer destocking in the spinal business.
Victrex confirmed it remains debt free, and by April net cash on the balance sheet had grown 28% to reach £74 million.
Chairman Anita Frew commented: "The Group's strong gross margin has been maintained and we have continued to invest in resources to drive key growth programmes. Cash generation remains strong, funding the PEEK capacity expansion project, which is on track, and underpinning our progressive dividend policy, which is reflected in a 15% increase in the interim dividend."
With a market cap of £1.4 billion, Victrex's shares trade at 20 times expected earnings, and now offer a trailing dividend yield of 2.3%.
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