Hansard Global's (HSD) shares fell nearly 12 per cent on the back of these full-year figures after the long-term savings provider saw single premium new business sales collapse from £109.1m to £51.3m. In order to conserve cash, the dividend for the year to end-June 2013 will be slashed 42 per cent to 8p a share. So, even though the shares trade well below embedded value, it's time to exit our buy tip.
Ironically, Hansard's regular premium new business sales actually rose from £112m to £124.4m, and new business margins grew from 8.3 per cent to 9.6 per cent. But market volatility reduced the value of assets under administration - which fell from £1.23bn to £1.03bn - and the previous year's £12m positive investment return was turned into a £17.1m hit. This meant that last year's £28.5m pre-tax profit, on an embedded value basis, was turned into a painful £13.7m loss.
Broker Numis Securities expects pre-tax profit, on an IFRS basis, of £9.6m for 2013, giving EPS EPS of 6.9p.
| HANSARD GLOBAL (HSD) | ||||
|---|---|---|---|---|
| ORD PRICE: | 104p | MARKET VALUE: | £143m | |
| TOUCH: | 103-106p | 12-MONTH HIGH: | 175p | LOW: 97p |
| DIVIDEND YIELD: | 13.4% | PE RATIO: | 13 | |
| NET ASSET VALUE: | 33p | EMBEDDED VALUE: | 163p | |
| Year to 30 Jun | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|
| 2008 | 23.6 | 17.0 | 12.0 |
| 2009 | 20.8 | 14.7 | 12.6 |
| 2010 | 16.6 | 11.9 | 13.2 |
| 2011 | 16.7 | 12.0 | 13.8 |
| 2012 | 11.1 | 8.20 | 13.9 |
| % change | -34 | -32 | +1 |
Ex-div: 26 Sep Payment: 19 Nov | |||
