Companies: QDG   

Quadnetics, the CCTV and network video systems supplier came in with good results for the six months to November. The company's revenues increased 78.9% to £12.7m and pre-tax profits were up 59% to £982,000. Quadnetics now operates four subsidiaries since acquiring Look CCTV, the UK market leader in on-bus CCTV systems with its 70% market share, and Coex, which provides CCTV for oil, gas, marine and hazardous environments. The latter business will be used as a channel to introduce new products from its Synectics division and larger orders are being chased, particularly Far Eastern shipyards. Quadrant Video Systems, a town centre CCTV systems provider, experienced lower activity in the first half but the order book indicates a strong pick up in the second half. The real growth potential for Quadnetics is Synectics: its integrated digital CCTV systems was introduced to the north American market and the installation of its system in a large casino in Canada has led to an order to for four more casinos. The subsidiary is also installing a £1m system for the UK police force as well as a system for a US department of transport. House broker Brewin Dolphin forecasts pre-tax profits of £3.8m for the year. The EPS of 22.8p throws up a prospective p/e of 13.9. This is very cheap compared to the sector average. Keep holding if you're in already, otherwise you could do worse than to add this stock to your portfolio.