UPDATE 1-Tyman operating profit jumps as UK, US construction recovers

Tue Mar 11, 2014 6:01am EDT

* Full-year underlying operating profit rises 41 pct

* Group revenue rises 30 pct to 298.1 mln stg

* Says to pay final dividend 4.50 pence per share

* Sees continued growth in 2014

March 11 (Reuters) - Tyman Plc, a maker of window and door hardware, said full-year underlying operating profit rose 41 percent, driven by a rebound in construction in Britain and North America.

The company, which also makes high-security locks and seals for windows and doors for residential and commercial markets, said it expected continued growth this year.

Shares in Tyman rose as much as 4.1 percent in early trading on Tuesday on the London Stock Exchange.

Underlying operating profit for the year ended Dec. 31 rose to 32.3 million pounds ($53.7 million) from 23.0 million pounds a year earlier. Group revenue rose 30 percent to 298.1 million pounds.

"We are encouraged by these figures as they show good operational leverage in the old U.S. businesses, and an excellent first six months of Truth," Liberum analysts said in a note.

Tyman, which operates in North America through its Amesbury and Truth Hardware divisions, said revenue from Amesbury, its door and window seals manufacturing unit, rose 12 percent to 132.4 million pounds.

Revenue from Truth Hardware - which Tyman acquired from Melrose Industries Plc for about $200 million last July - rose 5 percent to 42.9 million pounds for the six months under Tyman's ownership.

Tyman said it expected a further recovery in the new-build market in the United States this year and continued improvement in repair and remodelling.

Revenue from Tyman's British division Grouphomesafe, which makes door handles and locks, rose 17 percent to 86.0 million pounds. The company said new-build activity in Britain rose about 23 percent.

Construction in Britain grew at an annualised rate of more than 10 percent between April and September, according to official data, contributing to strong growth in the broader economy.

Canaccord Genuity analyst Harry Philips said he expected Tyman's North American businesses to grow by 10 percent in 2014, and the British market to grow at a mid-single digit rate through to 2016.

Philips raised his price target on the stock to 350 pence from 325 pence.

Tyman also forecast strong results in Brazil. It acquired Vedasil Brasil, a maker of pile weatherseals, last month to strengthen its footprint in South America.

Tyman, which also makes head cleaning pads for ink-jet printers for ATM machines, reported a pretax profit from continuing operations of 794,000 pounds, compared with a pretax loss of 25.8 million pounds a year earlier.

The company also recommended a final dividend of 4.50 pence per share, taking full-year dividend to 6.00 pence.

Shares in Tyman were trading up 3.8 percent at 274.25 pence at 0954 GMT on the London Stock Exchange. The stock was shifted to London's main market from the Alternate Investment Market after buying Truth Hardware in July.

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