MIDAS TIPS UPDATE: Change In The Air Drives Fan Maker Vol
Some parts of the country have been enjoying a mini heat wave and more are promised in the coming days. It makes a refreshing change and you should see sales of fans and air conditioning units skyrocket.
Volution specialize in all types of ventilation products and brands include Vent-Axia, used by millions of homes across the UK. Midas first recommended the shares in 2014 at £1.55.
They have since more than doubled to £3.84 and City supporters believe they have more to run in the next 12 months and beyond.
Volution specializes in all types of ventilation products, including extractors
Fans have always been a feature of kitchens and bathrooms. Too often, however, drives make a lot of noise and do very little. In the past, that was considered just a nuisance.
Today it is increasingly recognized that poor ventilation can cause serious damage and even be fatal. Last winter, when energy prices soared, consumers were advised to reduce the temperature of their central heating by a degree or two.
Struggling families took that advice a step further, lowering thermostats to just 16 degrees Celsius (61 degrees Fahrenheit) in an effort to reduce heating bills.
But cold air retains moisture, so those same homes have since seen a marked increase in mold and condensation, prompting a surge in demand for new, more effective ventilation products. That’s where Volution CEO Ronnie George comes into play.
In business since 2008, George assumed the top role in 2014, since then Volution has honed its reputation as a key player in delivering clean, healthy air to homes, schools, hospitals and office buildings.
Products have become increasingly sophisticated in recent years. Making sure fresh air is getting into a building is one thing, but in the dead of winter that can mean the loss of precious heat.
Volution has designed a smart piece of equipment that brings in clean air from the outside while keeping rooms warm, saving costs and reducing energy use. There’s also a focus on noise reduction, with the more sophisticated kit making barely any sound at all.
Government regulation is increasing regarding clean air in social housing and public buildings, and Volution is reaping the benefits.
Volution’s stock has more than doubled since 2014, when Midas first recommended it.
The group’s financial year ends on July 31, and George revealed last month that earnings would be at the higher end of expectations, as housing associations install modern equipment in existing homes and contractors select state-of-the-art technology for new ones. new properties.
Schools are also enthusiastic customers. Congested classrooms make children sleepy, so stale air is not good for health or attention to lessons.
Under George’s leadership, Volution has expanded overseas, with clients in continental Europe, Australia and New Zealand. Similar dynamics are playing out in all of these regions, as governments strive to ensure that homes and commercial buildings benefit from clean air, while keeping energy use to a minimum.
Such forces are helping Volution thrive, even as economic conditions are challenging and homebuilders are under pressure.
Brokers expect a 6.5% rise in annual sales to £328m, with a 4.5% rise in profits to £64m and a dividend of 7.7p, in compared to 7.3 pence last year. Further increases in sales, profits and dividends are expected for several years.
Midas Verdict: volution actions have proven to be a rewarding investment over the past nine years, and the company has regulatory tailwinds behind it. At £3.84, shares should continue to deliver growth.
Traded on: Main Market / Ticker: FAN / Contact: volutiongroupplc.com or 01293 441662