Ascential (ASCL) results were ahead of expectations for 2019, with sales growth in all four of its segments. Marketing led the way with organic growth of 9 per cent, benefiting from the return of a “key customer” to the Cannes Lions festival after a one-year break.
The group’s progress is not, however, clear from looking at the statutory results. Acquisition-related exceptionals such as £36.9m in deferred consideration for Flywheel Digital weighed heavily on earnings, pushing pre-tax profit and EPS down considerably. However, adjusted cash profits were up 18.5 per cent in the period, or 6.2 per cent on an organic basis, albeit on a margin 20 basis points thinner at 30.9 per cent.
One such acquisition was Chinese ecommerce analytics business Yimian, which Ascential acquired for a £19.5m initial consideration in December. Growth in China is a long-term strategic goal for the group, but management noted its customers in the region account for just 5 per cent of revenues, insulating the group from the impact of the coronavirus outbreak so far.
Broker Numis is forecasting adjusted pre-tax profits of £98.1m in 2020, giving EPS of 18.9p, up from £105.8m and 18.5p in 2019.
| ASCENTIAL (ASCL) | ||||
| ORD PRICE: | 364p | MARKET VALUE: | £1.47bn | |
| TOUCH: | 363.8-365p | 12-MONTH HIGH: | 426p | LOW: 319p |
| DIVIDEND YIELD: | 1.6% | PE RATIO: | 182 | |
| NET ASSET VALUE: | 132p* | NET DEBT**: | 37% | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2015 | 257 | -43.6 | -32.4 | nil |
| 2016 | 300 | -1.8 | 3.9 | 4.7 |
| 2017 | 293 | 19.9 | 2.9 | 5.6 |
| 2018 | 349 | 28.9 | 5.0 | 5.8 |
| 2019 | 416 | 10.2 | 2.0 | 5.8 |
| % change | +19 | -65 | -60 | |
| Ex-div: | 14 May | |||
| Payment: | 11 Jun | |||
| *includes intangible assets of £761m, or 189p a share. **Includes IFRS16 lease liabilities of £26.8m. | ||||
