Companies: CHLD   

Critical secure power products provider Chloride has cheered followers with another set of strong interim figures and news of a record £124m order book.

For the half to September, adjusted pre-tax profits surged 46% higher to £19.2m, on sales up 25% to £152.3m, with cash-generative Chloride (a business with low levels of debt) delivering a 16% interim dividend increase to 1.85p a share.

Substantial sales growth was seen both in Chloride’s core European market as well as in emerging economies such as Russia, South-East Asia and Central Asia. In terms of the business mix, product sales rose by 21% to £100.6m, with service revenues gathering up 34% at £52m – Chloride also reported ongoing improvement in the operating margin to 13.5% (2007: 12%).

In addition, the DB Power business, of which Chloride now owns 49% and will acquire 90% by July 2009, made its first contribution, adding £5.1m of sales to the top line and contributing £1.1m of profit.

Given its record orders – nicely underpinning prospects in deeply worrying economic climes – Chloride remains a resilient bet, since secure power remains essential for global business continuity. The fact that Chloride operates across a diverse array of sectors, including oil and gas, energy, manufacturing and government and IT lends further strength to the investment case.

Originally backed by Growth Company Investor at 101.75p in 2006, Chloride, whose board rejected a cash offer pitched at 270p from Emerson Electric in the summer, looks significantly undervalued.

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Chloride Group	LSE	£334.54m	128.25p	-7.50p
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Chloride Group			03/11/2008
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Chloride – lock away for the long-term			03/11/2006
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