Marketing services provider Communisis (CMS) has delivered impressive profit growth, backed by solid contract wins. Moreover, it raised a net £18.9m this month through a placing to fund further growth.
Adjusted operating profit surged 23 per cent in 2012 to £11.6m, while the group operating margin increased from 5.5 per cent to 6.5 per cent - chief executive Andy Blundell is targeting a 10 per cent margin by end-2015. This looks achievable, too, as higher margin digital work grew revenues by 20 per cent in the period to £30.1m. Contract wins with Nationwide, BT and more recently, Yorkshire Building Society and Thames Water, are also helping to bolster margins by pushing more work through a restructured and smaller number of sites. Meanwhile, strong growth in demand from managed service contracts in overseas markets meant that overseas revenue grew from 4 per cent of the group total to 7 per cent in 2012.
Housebroker N+1 Singer has upgraded its pre-tax profit estimates for 2013 by 9.5 per cent and now expects £12.2m, giving EPS of 5p (2012: £10.3m/5.4p).
COMMUNISIS (CMS) | ||||
|---|---|---|---|---|
| ORD PRICE: | 53.5p | MARKET VALUE: | £102m | |
| TOUCH: | 53.3-53.8p | 12-MONTH HIGH: | 55p | LOW: 25p |
| DIVIDEND YIELD: | 3.1% | PE RATIO: | 14 | |
| NET ASSET VALUE: | 66p* | NET DEBT: | 16% | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2008 | 257 | 12.7 | 6.24 | 2.50 |
| 2009 | 190 | 2.60 | 2.28 | 1.29 |
| 2010 | 193 | 4.92 | 3.20 | 1.29 |
| 2011 | 208 | 4.16 | 2.96 | 1.50 |
| 2012 | 230 | 6.78 | 3.75 | 1.65 |
| % change | +11 | +63 | +27 | +10 |
Ex-div: 17 Apr Payment: 20 May *Includes intangible assets of £167m, or 87p per share. | ||||
