A strong set of interim results has led us to upgrade our EPS forecasts for FY18 by 5.0% and FY19 by 2.5%. Other than a weather-related hiccup in the smaller US activity, there was good like-for-like progress in Europe, Asia and the UK. Input cost pressures at the gross profit level were mitigated by strong overhead control. Investment for growth continues across all regions and the strong balance sheet should facilitate M&A as appropriate opportunities arise with management taking a more proactive approach in target identification. Trifast’s shares have been very strong in the run-up to the results and are rated more appropriately, in our view, with the P/E discount to peers substantially diminished.

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