MIDAS SHARE TIPS UPDATE: IG Design, which comes into its own at this time of year, is a Christmas cracker!

Updated: 07:42 EDT, 9 December 2019

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IG Design comes into its own at this time of year. The company makes millions of festive items, including eco-Christmas crackers, wrapping paper, tags, bows and party goodies.

It also sells gift products, such as photo frames, calendars and corporate-sponsored items, including Nutella plates.

Chief executive Paul Fineman admits Christmas is important to IG, but sales outside the festive season also contribute to the bottom line.

Cracking: IG Design makes millions of festive items, including eco-Christmas crackers, wrapping paper, tags, bows and party goodies

The firm makes a huge range of children's stationery, shopping bags for retail chains, bin liners and recycling bags.

The blend of goodies is large, but the formula is working. Half-year results, released on Thursday, showed core profits up 14 per cent to £22 million and a 20 per cent increase in the interim dividend to 3p.

Brokers expect that pace to continue in the full year to March, with profits up 15 per cent to £35 million and a final dividend of 9.9p, compared to 8.5p the previous year.

The figures are noteworthy as IG has faced challenges in recent months. The firm makes most of its money in America so has had to cope with the US trade war with China, by changing suppliers and increasing local production.

Brexit uncertainty also disrupted sales but the company is fighting back, particularly in the speciality bags sector.

Midas verdict: Midas recommended IG Design in the summer of 2016, when the shares were £2.19. They have tripled since then to £6.60, and prospects seem bright.

Cautious investors may choose to sell some shares and use the money to brighten up their own festive season. But they should keep some stock, as the business still has plenty of potential.

Traded on: AIM Ticker: IGR Contact: thedesigngroup.com or 01525 887310

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