Notwithstanding the challenge posed by a global health crisis and the resultant economic turmoil, the past few months have allowed YouGov (YOU) to showcase the resilience of its business model. Indeed, the data analytics specialist says that it has thus-far endured no material blow from Covid-19. True, some clients have been hit, and have consequently cut down on their expenditure. But at the same time, the pandemic has spurred rising demand from other new and existing customers. And YouGov has met such demand by continuing to churn out relevant, adaptive insights from its data vaults – while simultaneously introducing new products.
Chief executive Stephan Shakespeare noted that one increasingly important sector for the group is health. And while privacy is integral to this particular arena, YouGov’s new ‘Direct’ platform focuses on data transparency and “ethical activation”, in line with Europe’s GDPR regulatory structure. YouGov is also helping some clients in the badly-affected tourism industry to prepare for changing travel patterns.
Numbers for the year to July were in line with management’s expectations – with revenue underpinned by strong trading in the US and UK markets. By business type, the group’s data products business – which includes its BrandIndex and YouGov Profiles products – was the star-performer, with sales up by almost a quarter. Operational leverage here – denoting the extent to which growth in revenues feeds through to growth in profits – meant that the adjusted operating margin edged up from 34.3 per cent to 35 per cent.
Overall, adjusted operating profits rose by close to a fifth, reaching £21.8m. That said, on a statutory basis, earnings slipped by roughly a quarter to £15.2m, reflecting the impact of £4.5m in acquisition-related costs and an impairment charge of £2.1m pertaining to YouGov’s Nordic business.
The group continued to invest during the period, with £8m injected into developing its tech platform alone. It also broadened its geographical horizons. Still, bosses opted to hike the dividend by a quarter to 5p per share – underpinned by a net cash pile of £26m, including lease liabilities.
Broker Numis expects adjusted EPS of 18.3p for FY2021, up from 17.2p in FY2020.
| YOUGOV (YOU) | ||||
| ORD PRICE: | 945p | MARKET VALUE: | £ 1.02bn | |
| TOUCH: | 930-960p | 12-MONTH HIGH: | 998p | LOW: 400p |
| DIVIDEND YIELD: | 0.5% | PE RATIO: | 105 | |
| NET ASSET VALUE: | 102p* | NET CASH: | £26m | |
| Year to 31 Jul | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2016 | 88.0 | 5.5 | 3.3 | 1.4 |
| 2017 | 107 | 7.9 | 4.4 | 2.0 |
| 2018 | 117 | 11.8 | 7.7 | 3.0 |
| 2019 | 136 | 19.4 | 14.1 | 4.0 |
| 2020 | 152 | 15.2 | 9.0 | 5.0 |
| % change | +12 | -21 | -36 | +25 |
| Ex-div: | 03 Dec | |||
| Payment: | 14 Dec | |||
| *Includes intangible assets of £84.6m or 79p a share | ||||
