Advanced Computer Software 's (ASW) results duly delivered on the bullish promises of a March trading update. The marked step-up in full-year revenues partly reflects the successful integration of accounting software provider CSH, acquired a year ago. But chief executive Vin Murria emphasised that the high rate of recurring revenues was a clear indication of the underlying strength of the business. These increased to 64 per cent of the total - from 57 per cent in the previous year.
Adjusted cash profits were in line with expectations - including acquisitions, they rose 68 per cent to £45.3m; the organic growth rate stood at 10 per cent. All three strands of the business delivered in the year, with Advanced Business Solutions bringing in ASW's largest ever contract, signed with the Northern Ireland Department of Health.
This led to a stand-out performance from the health & care division, which delivered organic revenue growth of 13 per cent. ASW has been positioned to exploit the trend towards the decentralisation of UK healthcare services. The company already supports 85 per cent of service providers for the NHS 111 non-emergency medical helpline, but there's still plenty of growth potential as the use of digital and mobile applications expands across community-based healthcare.
Broker Panmure Gordon increased its 2015 revenue estimate by 4 per cent to £219m, and its adjusted EPS estimate by 5 per cent to 6.9p (from 6.2p in fiscal 2014).
| ADVANCED COMPUTER SOFTWARE (ASW) | ||||
|---|---|---|---|---|
| ORD PRICE: | 122p | MARKET VALUE: | £584m | |
| TOUCH: | 122-125p | 12-MONTH HIGH: | 129p | LOW: 78p |
| DIVIDEND YIELD: | 0.4% | PE RATIO: | 42 | |
| NET ASSET VALUE: | 35p* | NET DEBT: | 29% | |
| Year to 28 Feb | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2010 | 30 | 4.2 | 1.1 | nil |
| 2011 | 95 | 3.2 | 1.2 | nil |
| 2012 | 98 | 6.4 | 1.8 | nil |
| 2013 | 121 | 9.2 | 2.6 | 0.40 |
| 2014 | 203 | 12.1 | 2.9 | 0.44 |
| % change | +68 | +32 | +12 | +10 |
Ex-div: 6 August Payment: 2 September *Includes intangible assets of £270m, or 56p a share | ||||
