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Photo-Me International First-half Profit Rises, Despite Lower Revenues

Shares of Photo-Me International Plc (PHTM.L) dropped about 3 percent Friday morning, as the company posted a decline in revenues for its first half ended October 31, 2012. However, profit increased from last year, reflecting lower costs and expenses. The company's board recommended a higher interim dividend and said it remains confident of good progress over the year.

John Lewis, non-executive chairman said, "The Group has again traded well in what is traditionally its stronger half and delivered a record result, despite a currency headwind. A growing estate, tighter management and lower costs have all contributed to this with notable improvements in Germany, Switzerland and Japan and another very good performance in our largest market, France."

The manufacturer of instant service equipment, including coin-operated automatic photobooths for identification and fun purposes and various vending equipment, said it is introducing more widely coin-operated laundry machines, which is expected to have substantial potential in the medium-term.

In the first half, the company's profit before tax increased to 20.02 million pounds from 17.05 million pounds in the previous year.

On a per share basis, earnings were 3.93 pence, higher than 3.23 pence per share reported last year.

Meanwhile, revenues for the period declined 7.1 percent to 107.39 million pounds. At constant currency, revenue decreased 2.1 percent.

Cost of sales decreased to 79.15 million pounds from 89.4 million pounds last year and administrative expenses were 8.69 million pounds, lower than 9.83 million pounds in the preceding year.

The board also recommended an interim dividend of 1.5 pence per share, up 20 percent from last year, to shareholders of record on April 2, 2013, payable on May 7.

"We continued to generate significant levels of cash in the period and the net cash position at the end of October was £70 million, an increase of £18 million since the end of April. We are therefore increasing the interim dividend by 20% and, during the second half of the year, the Board will be considering the options for returning some of this cash to shareholders," Lewis added.

PHTM.L is currently trading at 56 pence, down 1.5 pence or 2.61 percent, on a volume of 841 thousand shares, against a three-month average volume of 165 thousand shares.

by RTTNews Staff Writer

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