Booker's growth opportunities remain attractive for investors

As Booker reports half year results Sheridan Admans, investment research manager at The Share centre, explains what it means for investors.

"This morning, Booker reported a solid set of results that indicated the group continues to progress well with a 13% rise in profits after tax, which was in line with management expectations. Group like-for-like sales rose by 3.1% and internet sales were up 10.7%.

"Investors will have been keen to get an update on the integration of the UK operation of Makro, which was acquired from German company Metro in May. However, the results do not reflect the acquisition as the competitor review process is still being carried out by the Office of Fair Trading. Should the deal be approved, Booker expects it to reduce group operating profits by up to £10m in 2012/13 and increase operating profits by £10m in 2013/14.

"Growth seeking investors will be pleased to see Booker's tentative expansion into India is making good progress. Operations in the region continue to perform well and Booker expects to open a further two branches in the second half of the year.

"We continue to recommend Booker as a ‘buy' for medium risk investors. The interim dividend has been raised by 15.2% to 0.38p from 0.33p in 2011, a reflection of its earnings performance. The Makro deal also has the potential to expand Booker's consumer base and product range."