1300SMILES (ONT): Another Great Result From 1300SMILES.

By Jason Fittler

1300SMILES is a company of which Townsville can be proud. It is a local company first listed in 2005 and launched from our office.

Since then Daryl Holmes as the team have set about building a strong, recession proof business. The focus has been to grow but not at the expense of shareholders.

1300SMILES has consistently increased Earnings per Share year on year with a 14% increase for this last half year. They have also continued to increase the dividend per share as they understand that investors focus on not just capital growth but real cash flow and dividends.

All dividends are paid from cash flow.  The interim dividend will be $0.086 bring their gross forecast yield to 5.7%. For those who purchased the shares at $0.80 through the IPO  in 2005 this is a gross yield of 31% on their initial capital invested.

The half year reports had revenues up 20%, Net profit up 27%, dividend up 15%, Earnings Per Share up 14%, cash flow from operations up 60% and interest times coverage of 47 times with gearing at 23%.

These are big increases at the best of times but when compared to the results of the current reporting period, ONT is a step above the market.

The price jumped 5% on the back of the announcement and is currently sitting at $4.20, ONT has plenty of capacity for organic growth as well as opportunities to grow through acquisitions.

This is a local company with old school business values, which is reflected in the success it has achieved.

Since listing in 2005 the share price has grown 425%, paid investors back 30% of the purchase price in dividends and outperformed the market during the GFC.

If your broker is not recommending this stock to you, give us a call and we will walk you through why should own this company.

Download PDF of 1300SMILES results.

For more information on 1300SMILES please contact us on 07 4771 4577.