Shares in construction industry equipment manufacturer Somero Enterprises (SOM:AIM) jumped 14% to 482p after doubling revenue growth guidance for 2021.
Prior to today’s trading update analysts were expecting growth of 5% and 4% respectively for revenues and EBITDA (earnings before interest, taxes, depreciation, and amortisation) in the year to 31 December 2021.
The company now sees revenue growing almost 13% while EBITDA is expected to increase by nearly 19%. This implies around $100 million of full year revenue instead of the previous $93.3 million forecast, with $31 million of EBITDA versus $27.2 million previously.
Somero shares have soared more than 80% since Shares highlighted the recovery potential to readers last year (24 September 2020) at 260p.
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Somero, which makes top of the line laser-guided concrete floor flattening equipment, has seen customer demand strengthen in its key US market. The company also flagged ‘improving’ activity levels in Europe and Australia through the first four months of this year, prompting the guidance upgrade.
Demand has improved across the construction industry but it is the rampant need for more warehouse space as more businesses embrace digital commerce that is the real engine for improving trading conditions.
Somero continues to push ahead with new product development and investment in sales and support operations. The company remains confident that this will help expand its addressable market.
