These half-year figures from communications services group Hasgrove (HGV) aren't quite as impressive as they first appear. Restructuring-related costs hit last year's figures - adjust for that, and operating profit was unchanged year on year at £0.8m. However, that restructuring is now largely complete and Hasgrove has emerged looking well-placed to make progress - leaving the shares too cheaply rated.
After selling its public affairs unit, Interel, in July 2011 for £8.45m, Hasgrove is now focused on three businesses: marketing and technology company Amaze; intranet software group Interact; and design consultancy The Chase. Interact performed especially strongly, with operating profit up 70 per cent year on year to £383,000 - the unit signed up Age UK, Flight Centre, Lease Plan and Signet Trading as customers in the period, too. And while sales at The Chase slipped 6 per cent, not helped by delayed spend from a major client, it still turned last year's £113,000 loss into a £10,000 profit. Moreover, Amaze transformed the £29,000 loss it generated in 2011's second half into a £656,000 first-half profit and sales there rose 17 per cent year on year to £9.4m.
Broker Peel Hunt expects full-year adjusted pre-tax profit of £1.3m, giving adjusted EPS of 3.9p (from £0.6m and 1.3p in 2011).
HASGROVE (HGV) | ||||
|---|---|---|---|---|
| ORD PRICE: | 38p | MARKET VALUE: | £8.93m | |
| TOUCH: | 37-39p | 12-MONTH HIGH: | 52p | LOW: 24.5p |
| DIVIDEND YIELD: | 2.7% | PE RATIO: | na | |
| NET ASSET VALUE: | 71p* | NET DEBT: | 6% | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£000) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 10.5 | 136 | 0.50 | nil |
| 2012 | 12.2 | 652 | 2.00 | nil |
| % change | +16 | +379 | +300 | - |
Ex-div: - Payment: - *Includes intangible assets of £17.7m, or 75p a share | ||||
