Mitie (MTO) missed out on the government's prison outsourcing contracts earlier in the month, but first-half underlying pre-tax profit still grew 1.9 per cent year-on-year to £48.8m - in line with analysts' expectations. Moreover, a 4.7 per cent rise in the order book, to £9bn, means 98 per cent of the current year's revenues have already been secured, with 72 per cent secured for 2013-14.
But that wasn't enough to stop Mitie's shares slipping 6 per cent on the back of these figures. That was largely down to worries over how Mitie will continue delivering growth after announcing plans to significantly cut back the property management division. At present, that business generates revenues of £225m, although operating profit here slumped 31 per cent to £7.9m. Moreover, the group operating margin fell slightly to 5.2 per cent from 5.3 per cent. But the core facilities management business boosted revenue by 14.1 per cent to £518m, while divisional operating profit grew 29.8 per cent to £35.3m - helped by a contract with Lloyds.
Restructuring meant a £4.8m cost in the first half and those efforts remain ongoing. Broker Panmure Gordon expects full-year adjusted pre-tax profit of £113m, giving EPS of 23.8p (from 22.7p in 2012).
MITIE (MTO) | ||||
|---|---|---|---|---|
| ORD PRICE: | 279.3p | MARKET VALUE: | £1.03bn | |
| TOUCH: | 279.1-279.6p | 12-MONTH HIGH: | 303p | LOW: 234p |
| DIVIDEND YIELD: | 3.5% | PE RATIO: | 15 | |
| NET ASSET VALUE: | 111p* | NET DEBT: | 32% | |
| Half-year to 30 Sep | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 0.97 | 43.3 | 9.4 | 4.4 |
| 2012 | 1.03 | 37.7 | 8.0 | 4.6 |
| % change | +6 | -13 | -15 | +5 |
Ex-div: 12 Dec Payment: 4 Feb *Includes intangible assets of £417m, or 113p a share | ||||
