Investors sent shares up more than 6 per cent in Next Fifteen Communications (NFC) after the Aim-listed digital marketing group revealed an 8 per cent rise in full-year organic sales and a clutch of client wins, including Moneysupermarket.com. Operating profits for the year to January 2016 leapt 30 per cent to £16.5m, compared with £12.7m for the previous 12 months.
Next Fifteen specialises in innovative, data-driven services such as predicting consumers' behaviour. That has made it popular with big US technology companies: it recently created digital learning courses for Google's retail staff and helped the search giant launch online stores where customers can compare devices. Strong showings from its M Booth and Beyond agencies underpinned organic growth of 14 per cent across the pond, widening the group's operating margin by 1 percentage point to 12.7 per cent.
Management continued to modernise and simplify the business. It exited territories such as South Africa and Denmark, reduced its cost base in other markets and merged several agencies. It also made three acquisitions that bolstered its range of services, and has made another two since the period ended.
Broker Peel Hunt raised its forecasts and now expects pre-tax profits of £20.5m in the year to January 2017, giving EPS of 20.3p (from £16.1m and 16.9p in FY2016).
| NEXT FIFTEEN COMMUNICATIONS (NFC) | ||||
|---|---|---|---|---|
| ORD PRICE: | 253p | MARKET VALUE: | £182m | |
| TOUCH: | 250-255p | 12-MONTH HIGH: | 277p | LOW: 173p |
| DIVIDEND YIELD: | 1.7% | PE RATIO: | 42 | |
| NET ASSET VALUE: | 72p* | NET DEBT: | 12% | |
| Year to 31 Jul | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 86 | 7.5 | 9.1 | 2.05 |
| 2012 | 92 | 6.0 | 6.9 | 2.30 |
| 2013 | 96 | 2.1 | 0.6 | 2.55 |
| Year to 31 Jan | ||||
| 2015** | 158 | 0.4 | -0.2 | 3.50† |
| 2016 | 130 | 5.6 | 6.0 | 4.20 |
| % change | - | - | - | +20 |
Ex-div: 30 Jun Payment: 5 Aug *Includes intangible assets of £53.6m, or 74p a share **18-month period †Pro forma for the 12 months to 31 January | ||||
