Coming together!



It’s coming together at Howden Joinery

Howden Joinery (HWDN) has traded sideways for the past year and underperformed the FTSE All-Share index in 2016 so far. Last month’s four-month trading update was well-received, confirming that business at the kitchen supplier is in line with expectations.

Revenue rose 8.7% in the UK and 6.4% on a like-for-like basis, and chiefs are betting that market conditions are stable, “albeit we remain watchful”. We’ll know how much the £3 billion firm made when it publishes half-year results on 21 July.

As well as an ongoing share buyback programme, Howden is chasing growth. It already runs 625 depots and plans to open another 30 in the UK this year. Earlier this year it increased its medium-term target from 700 to “up to 800” depots.

A forward price/earnings (PE) ratio of just under 17 times is not cheap, but profit is tipped to grow at a fair lick if Numis Securities has got its sums right.

And it’s definitely a price chairman Richard Pennycook and non-executive directors Geoff Drabble and Andrew Cripps are prepared to pay.

Pennycook has just taken over from Will Samuel, who stood down after a decade in the role, and celebrated getting the chairman’s job by spending £250,000 on 54,663 shares at 483.9p.

Both Drabble, in his current role for less than a year and still boss of equipment rental firm Ashtead, and Cripps bought 3,000 shares. They paid 488.4p and 483.7p, respectively.

Even a massive sale by Matthew Ingle, the man who started Howdens as part of the old MFI back in 2005, has not dented enthusiasm. We hear Friday morning that the chief executive offloaded 1.4 million shares yesterday at an average of 486.62p, trousering a cool £6.8 million.

But the share price is up a few pennies in a rising market, and clearly there is no reason for alarm bells to start ringing. Ingle has been a fairly predictable seller of Howden shares and last summer pocketed over £6 million from the sale of stock at 492p.