Currency translation helped to lift full-year revenues at translation software provider SDL by 14 per cent. Stripping the currency effect out revealed a like-for-like revenue decline of 8 per cent, although chief executive Mark Lancaster says organic growth has returned, with underlying revenues rising 10 per cent in the fourth quarter of the year.
After making two acquisitions last year - online e-commerce player Fredhopper and content management business XyEnterprise - SDL now reports performance across three separate divisions. The largest, accounting for 64 per cent of sales, is language services. This unit suffered an 11 per cent reverse in sales on a constant currency basis, although Mr Lancaster says demand has now recovered. Similarly, language technologies has suffered organic declines, but the software business, which represents 19 per cent of revenues, has remained robust, with underlying sales rising 6 per cent.
SDL (SDL) | ||||
|---|---|---|---|---|
| ORD PRICE: | 456p | MARKET VALUE: | £351.3m | |
| TOUCH: | 453.75-456.5 | 12-MONTH HIGH: | 495p | LOW: 277p |
| DIVIDEND YIELD: | nil | PE RATIO: | 19 | |
| NET ASSET VALUE: | 225p* | NET CASH: | £46.2m | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2005 | 79 | 5.2 | 4.9 | nil |
| 2006 | 95 | 9.4 | 9.9 | nil |
| 2007 | 117 | 12.7 | 13.1 | nil |
| 2008 | 159 | 19.9 | 19.2 | nil |
| 2009 | 172 | 24.0 | 23.6 | nil |
| % change | +8 | +21 | +23 | - |
Ex-div: na Payment: na *Includes intangible assets of £137.6m, or 179p a share | ||||
More analysis of company results
Mr Lancaster is looking to improve cross-selling opportunities as the acquisitions are integrated. Moreover, with £46m cash in the bank, more deals could happen, and a maiden dividend will be introduced in 2010.
Analysts at Piper Jaffray are expecting 2010 pre-tax profits of £26.5m and EPS of 24.9p.
