After a challenging year in 2016 that led to a profit collapse, Sprue Aegis (LSE:SPRP) is bouncing back. The company designs and distributes smoke and CO alarms, including those that can be connected to the internet, and City analysts predict a 128% recovery in earnings this year and 32% during 2018.
Sprue announced the launch of the UK's first battery-powered 'Natural Gas Detector', a major new product innovation for the company, under its FireAngel brand.
The FireAngel Natural Gas Detector is uniquely powered by replaceable batteries and is simple to use as a portable or freestanding device.
Designed and independently tested to meet the European standard for domestic combustible gas detectors (BS EN 50194), the unit features a semi-conductor catalytic sensor that continuously detects combustible gas plus "smart" test, silence and reset buttons for ease of use.
Sprue reported a strong return to profitability through a significant improvement in gross margin and a net reduction in overheads. As announced on 15 June 2017, Sprue made a positive start to the year and for H1 2017 expects to report sales of approximately £26m (H1 2016: £25.9m) and operating profit of approximately £1.5m (H1 2016: operating loss of £0.9m before share based payments charge).
The Group remained well positioned to deliver full year adjusted operating profit in line with market expectations.
With the FTSE 100 trading close to a record high, it may seem as though all stocks are highly valued. While in some cases this may the case, there continue to be a number of growth stocks which could offer high share price returns in the long run. Certainly, their outlooks may be somewhat risky, due in part to their size and lack of scale. However, here are two companies which could prove to be highly profitable investments over a sustained period.
Sprue Aegis said it has made a positive start to the year with an an expected strong return to profitability in H1 2017 building on the steady progress delivered by the Company in the second half of 2016.
Executive chairman Graham Whitworth continued that the combination of a significant improvement in gross margin and a net reduction in overheads was expected to contribute to a much improved financial performance by the group in H1 2017 compared to H1 2016.
"Despite the recent modest currency fluctuations (Sterling v US Dollar and Sterling v Euro), the Group remains well positioned to deliv