Motivcom (MCM) - which organises conferences and employee motivation schemes for blue-chip corporate clients in the UK and Europe - grew half-year adjusted operating profit by 35 per cent to £1.8m. That significantly reflected cost-cutting efforts and was delivered despite a drop in revenues.
The motivation division, which is the company's largest in terms of profit generation, increased adjusted operating profit by 20 per cent to £0.88m as new client wins in 2012 provided a boost. Management says that confidence among its clients is improving, with faster, more dependable decisions on investment and a general willingness to now spend on employee engagement measures. "We see some good positive signs; increasing confidence in all areas," says chief executive John Sylvester. Moreover, the promotion division reported a near-doubling of adjusted operating profit to £0.2m, driven by new business wins and improved efficiency. While the events division grew adjusted operating profit by 38 per cent to £0.81m as the benefits of cost-cutting in 2012 came through.
A 10 per cent share buyback was completed in April and, with the company still holding net cash, it has the flexibility to consider further share buybacks or bolt-on acquisitions. Broker Numis Securities expects full-year pre-tax profit of £4.7m, giving EPS of 12.8p (from £4.1m and 10.5p in 2012).
MOTIVCOM (MCM) | ||||
|---|---|---|---|---|
| ORD PRICE: | 153p | MARKET VALUE: | £41.6m | |
| TOUCH: | 150p-156p | 12-MONTH HIGH: | 157p | LOW:87p |
| DIVIDEND YIELD: | 3.1% | PE RATIO: | 18 | |
| NET ASSET VALUE: | 72p* | NET CASH: | £3.8m | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 49.2 | 0.90 | 2.15 | 1.50 |
| 2013 | 46.3 | 1.56 | 4.18 | 1.80 |
| % change | -6 | +74 | +94 | +20 |
Ex-div: 2 Oct Payment: 1 Nov *Includes intangible assets of £23.4m, or 86p a share | ||||
