"In the context of the worst recession since 1066, we have provided a great set of results," jokes Alan Hearne, chief executive of multi-disciplinary consultancy RPS. Despite this buoyancy, fee income and profits were down in two of the firm's three divisions. Planning and development fee income fell 3.6 per cent after private-sector activity reduced due to scarce credit, while energy fees also fell 5.6 per cent, as global investment in exploration and production slowed.
The smallest division, environmental management, which accounts for 16 per cent of underlying operating profits, provided a fillip with profits up 11 per cent. And there were very encouraging signs in Australia, which saw a 40 per cent increase in fee income, supported by the acquisition of consultancy Conics. Strong cash conversion of 114 per helped underpin the dividend increase, despite the fall in earnings. Net debt was up from £29m to £33m, but is still a small proportion of the group's £125m loan facility.
Mr Hearne's outlook is fairly downbeat as the economies of the UK and Ireland remain fragile, while investment has not improved markedly in 2010. But the group is confident on organic growth in Australia as well as acquisitions.
Broker WH Ireland expects full-year pre-tax profits of £53.5m and EPS of 17.4p (£52.5m and 17.1p in 2009).
RPS Group (RPS) | ||||
|---|---|---|---|---|
| ORD PRICE: | 179p | MARKET VALUE: | £386m | |
| TOUCH: | 178-179p | 12-MONTH HIGH: | 250p | LOW: 123p |
| DIVIDEND YIELD: | 2.3% | PE RATIO: | 11 | |
| NET ASSET VALUE: | 146p* | NET DEBT: | 10% | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2005 | 218 | 24.3 | 9.01 | 2.40 |
| 2006 | 297 | 34.6 | 11.90 | 2.76 |
| 2007 | 363 | 44.5 | 15.00 | 3.18 |
| 2008 | 470 | 54.8 | 18.00 | 3.66 |
| 2009 | 444 | 48.6 | 15.80 | 4.20 |
| % change | -6 | -11 | -12 | +15 |
Ex-div: 14 Apr Payment: 27 May *Includes intangible assets of £294m, or 136p a share | ||||
