Pension and employee benefits specialist Mattioli Woods (MTW) is already reaping the benefits of a surge in demand for consultancy and advice, following major government changes to the way individuals can manage their pensions. "This is a massive opportunity," explains chairman Bob Woods, who sees limitless scope for the group to extend its client advisory business. "Almost everybody with any sort of assets or pension will need financial advice following these changes."
Although the changes do not come into full effect until April, Mattioli's investments in new staff are already bearing fruit. Stripping out a number of acquisitions, the group achieved organic revenue growth of 20 per cent in the first half of the year.
Other encouraging signs include a 16 per cent increase in client assets to just over £5bn, and an increase in recurring fees as a proportion of total revenues by 2.5 points to 82.1 per cent. Changes to capital requirements for operators of self-invested personal pensions also position the company nicely for further acquisitions - as does a cash pile worth 38p per share.
One problem to watch is profitability: earnings growth lagged behind sales growth due to higher operating costs and a higher effective tax rate. Broker N+1 Singer is cautiously forecasting full-year earnings per share of 26.1p, rising to 28p in 2016 (27.8p in 2013-14).
MATTIOLI WOODS (MTW) | ||||
|---|---|---|---|---|
| ORD PRICE: | 505p | MARKET VALUE: | £103m | |
| TOUCH: | 500-510p | 12-MONTH HIGH / LOW: | 505p | 399p |
| DIVIDEND YIELD: | 1.8% | PE RATIO: | 22 | |
| NET ASSET VALUE: | 185p* | NET CASH: | £7.7m | |
| Half-year to 30 Nov | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 13.4 | 2.2 | 9.7 | 3.1 |
| 2014 | 16.6 | 2.7 | 10.3 | 3.3 |
| % change | +23 | +22 | +6 | +8 |
Ex-div: 5 Feb Payment: 6 Mar *Includes intangible assets of £29.2m, or 144p a share | ||||
