Yell's shares plunged over 20 per cent after news that both chief executive John Condron and chief financial officer John Davis are stepping down. Mr Condron will retire by May 2011 while Mr Davis will step down once a successor is in place.
With trading still grim at the directories specialist, it's hard to blame the pair for wanting out. Group revenues (on a constant currency basis) slumped 13.8 per cent year-on-year, while adjusted cash profits dropped 24.1 per cent to £620m. What's more, a return to growth remains a distant prospect with clients continuing to stall over spending - symptomatic, reckons Mr Davis, of Yell's typical small business customer. In fact, management expects group revenues to decline by about 11 per cent in the three months to end-June, with much the same anticipated for the thee months to end-September. Still, £60m of cost savings have been identified this year.
True, the net debt pile was reduced by £1.1bn in the year - thanks to November's £559m fund raising and free cashflow of £397m in the period. But net debt remains at nearly four times the group's market value.
Numis Securities expects adjusted pre-tax profit of £250m for 2011, giving EPS of 7.1p (from £238.4m and 11.7p in 2010).
YELL (YELL) | ||||
|---|---|---|---|---|
| ORD PRICE: | 36p | MARKET VALUE: | £850m | |
| TOUCH: | 36-37p | 12-MONTH HIGH: | 81p | 19p |
| DIVIDEND YIELD: | NIL | PE RATIO: | 11 | |
| NET ASSET VALUE: | 59p* | NET DEBT: | £3.1bn | |
| Year to 31 Mar | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2006 | 1.62 | 317 | 30.1 | 15.3 |
| 2007 | 2.08 | 248 | 27.6 | 17.1 |
| 2008 | 2.22 | 311 | 26.5 | 12.0 |
| 2009* | 2.40 | -1033 | -124 | nil |
| 2010 | 2.12 | 70.3 | 3.40 | nil |
| % change | -12 | - | - | - |
Ex-div: - Payment: - *Includes intangible assets of £4.49bn, or 190p per share | ||||
