RESULTS: Restructuring expenses and budgetary pressures among its clients continue to weigh on Motivcom (MCM), which helps companies improve employee engagement and organises meetings and events. But tight cost control meant it eked out a 7 per cent increase in operating profits last year.
The star performer was its motivation division, where gross profits rose 18 per cent. It provides gift cards, vouchers and other perks to its clients' employees; these can help lower absenteeism and churn and improve productivity. Motivcom's promotions division also performed decently, with gross profits up 9 per cent to £9.3m. Gains there were driven by a shift towards digital marketing, which has attracted new clients.
But those gains were offset by its troubled meetings and events division, which has suffered from companies tightening their purse strings. Sales slumped a quarter and operating profit, adjusted for impairment charges, fell by 50 per cent. Motivcom’s efforts to reverse the decline, such as investing in new staff and software and consolidating its operations under one key brand, Zibrant, are yet to pay off.
Broker Numis Securities trimmed its estimates for pre-tax profit and EPS by about 6 per cent to £4.7m and 13.1p, up from £4.4m and 11.9p last year.
| MOTIVCOM (MOTI) | ||||
|---|---|---|---|---|
| ORD PRICE: | 142p | MARKET VALUE: | £40m | |
| TOUCH: | 139-144p | 12-MONTH HIGH: | 175p | LOW: 104p |
| DIVIDEND YIELD: | 3.8% | PE RATIO: | 21 | |
| NET ASSET VALUE: | 71p* | NET CASH: | £6.4m | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2009 | 102 | 3.1 | 7.7 | 2.50 |
| 2010 | 115 | 4.4 | 10.7 | 3.20 |
| 2011 | 106 | 3.3 | 8.1 | 4.00 |
| 2012 | 107 | 2.5 | 6.5 | 4.50 |
| 2013 | 96 | 2.8 | 6.9 | 5.40 |
| % change | -10 | +13 | +5 | +20 |
Ex-div: 2 Apr Payment: 18 Jun *Includes intangible assets of £22m, or 79p a share | ||||
