In 2006, concrete floor laying specialist Somero Enterprises was flipped back onto the AIM market by its private equity owners. During its short period of private ownership, Somero’s balance sheet had been loaded up with net debt of about $20m. At the same time, western economies were hurtling with eyes closed towards the biggest financial crisis since 1929.The result was inevitable. Somero came close to insolvency, but just managed to survive. The group has since repaired its balance sheet and benefited from the cyclical upturn. Somero shares have risen by 850% over the last five years and offer a bulletproof dividend.Yet as shareholders will have noticed, Somero’s share price has fallen by 20% since hitting a post-2007 high in June. The shares have now given up all of this year’s gains. Concerns over the China-led emerging market slowdown are probably to blame, as are fears that the market may be approaching a cyclical peak. Are these fears justified? Somero’s interim results suggest a mixed picture. Sales in North America rose by 27% during the first half, delivering 68% of the group’s total revenue. The second biggest single contributor was China, where sales fell by...
