This is one I have mentioned in passing in an earlier posting back in April entitled If greed is good then boring is... which featured Berendsen (BRSN) as one of the boring stock examples. They have today reported an update statement before entering its close period for the half year ending 30 June 2014 and prior to its half year results announcement, which will be issued on 29 August 2014. 

In this they report that they are trading in line with expectations with a 3% rise in underlying revenues overall and in their core business at constant exchange rates. However, in common with many UK businesses with overseas operations, they have been hit by the rise in Sterling this year. This means that their actual reported revenues will be down by 1% in the period as a result. They do however talk about improved margins in their growth businesses and some improvement in their more mature cash cow businesses like work wear and flat linen (sheets and towels) in the UK from new business. In linen overseas they flag revenue gains from contract wins but lower profits due to lower pricing and start up losses for new operations. They suggest their interest costs were down thanks to strong cash flow and that their reported pre tax profits were ahead over the first five months. So it sounds like steady as she goes and the Company said in closing: 

"Whilst our reported results will be influenced by the impact of currency translation, on an underlying basis, we have made good progress for the first half of the year in line with management's expectations, and the Board continues to expect to achieve further good progress for the year as a whole."

They seem fairly valued having come back recently with other mid cap stocks so at 983 pence they are on around 14 to 15x earnings with a well covered 3% yield which is expected to grow by around 7% per annum. Nothing in this statement to get upset or excited about either way but then that is what you would expect from a staid stock like this. But as I said before boring can sometimes be brilliant - see chart below and the link to my earlier post for more details and the file below to download a fact sheet on them.

brilliant!? Three brief updates today from seemingly boring stocks:

1) Berendsen (BRSN)- which with its subsidiaries is engaged in the laundering and maintenance of textiles. The Company provides service solutions to source, clean and maintain the textiles that the customers need to keep their businesses running.
2) Computacenter (CCC)- The IT service provider which I wrote up after its results last month.
3) Unilever - (ULVR) well everyone knows what they do, don't they?

Please note also that the chart above is a price chart and does not include the fairly decent dividends / yields paid by these Companies over the last five years.

Taking Berendsen first as this has been a longer term holding for me and one I have traded successfully over the years. It used to be called Davis Service Group and has generally stuck to what it knows which is textile rental, dust mats, wash rooms and work wear (uniforms) etc. It supplies these services to hotels, hospitals and other businesses so it tends to be a fairly steady business but with some economic sensitivity from the hotel, catering  and industrial uniform side of things.

Any way their update today saw trading in the first three months of the year in line with management's expectations. Underlying revenue for the Group, at constant exchange rates, was up 3% compared to the equivalent period last year and in their Core Growth businesses, revenue increased 4%.  Reported revenue for the Group, including the impact of currency translation, was similar to last year. Their margins increased again in their core business and this meant their operating profits were also up here. While in their ex growth bits or what they describe as manage for value businesses (cash cows), 
as expected revenue was similar to last year here, but profits were lower as a result of the contract re-pricing in the second half of last year and start-up costs on a number of significant new contracts.

Cash flow remained strong and the group expects to deliver further growth this year. Given the rise in the shares over the last few years (see chart above) they are not such good value as they were, but in the context of the current market and with their strong forecast eps growth and dividend growth trending at around 7%, 2x covered by earnings they seem OK if not outstanding value on around 16.7x earnings with a yield of 2.9% forecast for this year with the shares at 1044p. 

Next I'll briefly pick up on Unilever which I mentioned in my post earlier this week when I returned from my Easter break. This was because Diageo had flagged the effects of weak emerging market currencies and some weakness in consumer demand in some of those markets. Well Unilever talked about underlying sales growth of 3.6% overall and 6.6% in Emerging markets and pricing being up by 1.6% but overall turnover fell by 6.3% after an 8.9% currency hit - so the same effect there. However they talked about positive results in Home Care and Personal Care and a strong start to the year in Refreshment. Their food business declined which they blamed on the timing of Easter. The market does not seem to like the results as the stock is off 1.3% this morning in a market that is up 0.5%. Given it is on around 19x and struggling to grow I guess the price reaction is not that surprising for an expensive defensive stock. However as far as I'm concerned the most interesting bit in the announcement was that the quarterly dividend was up by 6% to 28.5 cents or 23.3 pence. This is around about the 7% growth that is forecast by analysts which puts it on a 3.5% yield for the current year at the current 2600 share pence price. So as a result I'll probably retain my small holding for the yield as part of a broader diversified income portfolio.

Finally - briefly, you'll be pleased to hear Computacenter can be summarised as UK business strong, Germany stable and France still struggling and providing a drag on performance with an exceptional restructuring charge of between £7 million and £9 million. They still have cash on the balance sheet and cash generation remains strong. If you want a more detailed review of the business then please click though (at the link above) to my write up from last month - it still seems OK having drifted back after the results as I expected to leave it on around 13x with a 3% yield @ around 650 pence. I'll leave it there and well done if you got this far - but as I said at the beginning boring can be brilliant!