Companies: CARL   

‘We are all about consistent, measured growth’, assures Frank Bandura, finance director of casual dining counter Carluccio’s, which cooked up forecast-busting maiden AIM figures for the year to September.

The authentic Italian restaurants group, floated a year ago at 94.5p, made all the right noises on numerous growth metrics. As well as 24% growth in both sales and EBITDA – turnover rose to £45.8m and earnings improved to £5.6m – Bandura reported a 25% hike in underlying pre-tax profits (adding back £900,000 of one off float costs) to £4.3m, with margins steady despite rising utility bills.

Five new stores opened last year, as per plan, and a further five sites have been secured for 2006/07. Tellingly, every one of the 28 stores up and running today makes money. ‘New stores are cash generative immediately’, says Bandura, ‘and though it costs about £700,000 to open, we see a payback within 2 years’.

Bumper levels of cash generated last year left Carluccio’s flush with £2.6m cash at year-end and allowed for a 1.5p dividend in the group’s first year as a public company.

Carluccio’s has boiled up five years of uninterrupted double-digit sales and earnings growth, and is looking to build a nationwide brand, with nine sites now located outside London. This year, look for profits of £5.2m from £53m sales, and 18% earnings growth to 6p, as well as a 1.7p dividend. For 2008, earnings should burgeon by a further 20% to 7.2p.

Trading on pricey PEG ratios of 1.5 and 1.1, the shares have already proved emphatic performers and aren’t value morsels for newcomers. However, investors prepared to pay a premium price for strong earnings and dividend growth might consider buying in. Hold/Buy.