If we ignore exceptional items of £10.5m, mainly relating to acquisitions and discontinued engineering activities, outsourcing group Mitie’s pre-tax profits grew by 12 per cent to £47.5m in the first half. And with 95 per cent of full-year revenues booked, broker WH Ireland forecasts another year of strong growth, pencilling in adjusted pre-tax profits of £104m and EPS of 20.7p for the 12 months to March 2011 (2010: £91.6m and 19.1p).
On an underlying basis, group revenue grew 1.6 per cent in the six month trading period helped by major contracts wins with Rolls-Royce to provide facilities and energy management to its entire European property portfolio and a similar deal with Vodafone in the UK. The group's technical and core facilities management businesses, accounting for 75 per cent of profits, have been performing particularly well, boosting underlying revenues by 11 and 3.3 per cent, respectively. This helped offset weakness in its property and asset management divisions which experienced more challenging conditions and margin pressure.
Offering clients a wide-ranging outsourcing service from cleaning to renewable energy solutions is now a group priority and a strategic team dedicated to this goal is currently in the tendering process with the Ministry of Justice. This contract would include prisoner escorting and community service management as well as dealing with the department’s property portfolio.
Mitie (MTO) | ||||
|---|---|---|---|---|
| ORD PRICE: | 209p | MARKET VALUE: | £ 746m | |
| TOUCH: | 208-209p | 12-MONTH HIGH: | 246p | LOW: 188p |
| DIVIDEND YIELD: | 3.9% | PE RATIO: | 13 | |
| NET ASSET VALUE: | 100p* | NET DEBT: | 30% | |
| Half-year to 30 Sep | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2009 | 801 | 39.6 | 8.60 | 3.70 |
| 2010 | 919 | 36.9 | 7.70 | 4.10 |
| % change | +15 | -7 | -10 | +11 |
Ex-div: 15 Dec Payment: 03 Feb *Includes intangible assets of £399m, or 112p a share | ||||
