A year of strong sales and profit growth has prompted foreign-exchange service provider Alpha FX (AFX) to raise its annual dividend by a third. The group saw client numbers increase by 55 per cent in 2018 – to 482 – which, along with a good performance from the UK corporate market and expansion into European markets, drove the top line up by nearly three-quarters.
The group has also made good on its plan to target institutions by launching a new division dedicated to servicing these clients, with total headcount moving from five to seven by the year-end. The division’s performance has exceeded expectations, bosses say, which could be down to what they call “a highly talented team” who have been rewarded “through performance-based equity incentive mechanisms”. This means that when Alpha FX launches a new business vis its subsidiary companies, employees are granted a minority stake tp encourage retention.
While Alpha FX is intent on establishing a new headquarters in London by the third quarter of 2019, its focus on international markets is just as sharp. A new office opened in Canada last October, based in Toronto, following an initial UK-based trial. In the first quarter of 2019, the new office has already won revenue-generating clients.
Bloomberg consensus forecasts are for adjusted EPS of 23.7p for 2019, compared with 21.3p in 2018.
ALPHA FX (AFX) | ||||
ORD PRICE: | 675p | MARKET VALUE: | £246m | |
TOUCH: | 660-690p | 12-MONTH HIGH: | 710p | LOW: 488p |
DIVIDEND YIELD: | 1% | PE RATIO: | 31 | |
NET ASSET VALUE: | 129p | NET CASH: | £35.7m |
Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
2016* | 8.5 | 4.3 | 13.4 | nil |
2017 | 13.5 | 5.6 | 14.2 | 4.9 |
2018 | 23.5 | 9.7 | 21.8 | 6.5 |
% change | +73 | +73 | +54 | +33 |
Ex-div: | 11 Apr | |||
Payment: | 15 May | |||
*Pre-IPO figures |