Dart Group

Last November, aviation services and distribution group Dart pleased investors with strong half time numbers to 30 September in some pretty tough markets. Profits, pre-tax and goodwill, spiked up from £7.4m to £11.1m on substantially higher turnover of £140.4m (£119.7m), and shareholders enjoyed a 10% dividend uplift to over 2p a share. During the first half, Dart's capital expenditure was some £23m, mainly pertaining to the purchase of Boeing 737-300 aircraft for its aviation services division. This part of the business, which delivered £89m of first half sales, includes freight forwarder Benair Freight International and Channel Express (Air Services), which operates contract charter passenger and freight air services. Channel Express also runs budget services from the North and Northern Ireland under the trading name Jet2.com. Dart's other division is the distribution one - Fowler Welch-Coolchain. It distributes fresh produce and horticulture products for supermarkets and their suppliers, and despite facing tricky pricing issues, management is optimistic about the division's 'future profitable growth'. Admittedly, Dart is a seasonal play, since the lauded Jet2.com turns in profits over the summer and losses in the weaker winter months. Yet last year to March, pre-tax profits (stripping out goodwill) edged up from £7.9m to £9m. And in an encouraging September update, Dart predicted pre-tax profits for the year to March 2005 would be 'materially' ahead of market expectations. Well worth holding.

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Sector: General Industrials

Companies: Dart

Market cap: £129m

PE Forecast: n/a

Share price: 374p

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