Shares in Micro Focus (MCRO) took another dive after the Newbury-based software group revealed falling US revenues and the departure of its executive chairman Kevin Loosemore after 15 years in the job. Revenue was down 9.1 per cent in the 12-months from October 2018, although a modicum of solace is provided by a slight uptick in the group’s cash margin.
Management laid the blame on changing buying behaviour and the difficult integration of the Hewlett Packard Enterprise (HPE) Software business. The group conceded that the HP systems were not fit for purpose and are continuing to impact core business operations, execution levels, and overall productivity. Integration and associated costs amounted to $246m (£189m) during the period. The group anticipates total exceptional charges in relation to the HPE Software business of $960m, of which $715m has been incurred to date.
Numis gives adjusted EPS of 160¢ for the Oct 2020 year-end and 153¢ in FY2021.
| MICRO FOCUS (MCRO) | ||||
| ORD PRICE: | 829p | MARKET VALUE: | £2.76bn | |
| TOUCH: | 828-829p | 12-MONTH HIGH: | 2,174p | LOW: 826p |
| DIVIDEND YIELD: | 10.8% | PE RATIO: | na | |
| NET ASSET VALUE: | 1,883¢* | NET DEBT: | 69% | |
| Year to 30 Apr | Turnover ($bn) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
| 2015 | 0.83 | 91.0 | 58.5 | 48.40 |
| 2016 | 1.25 | 195 | 74.5 | 66.68 |
| 2017 (Restated) | 1.08 | 132 | 68.9 | 88.06 |
| Year to 31 Oct | Turnover ($bn) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
| 2018** | 3.68 | -78.5 | 143 | 100.84 |
| 2019 | 3.35 | -34.1 | -4.87 | 116.66 |
| % change | -9 | - | - | +16 |
| Ex-div: | 7 May | |||
| Payment: | 3 Feb | |||
| *Includes intangible assets of $12.8bn, or 3,853¢ a share. **Comparatives for Oct 2018 have been annualised to take account of year-end change. £1=$1.30. | ||||
