A significant rise in new investment commitments from £182m in 2016 to £383m last year probably explains why infrastructure specialist John Laing (JLG) is tapping its investors for more cash. The group wants to raise £210m via a one-for-three rights issue at 177p – a 29 per cent discount to the theoretical ex-rights price based on the closing middle-market price the day prior to the announcement.
According to the group’s managers, there are two reasons for the sudden surge in work. The US market has shown faster growth than anticipated, while consistent efforts to build relationships with international partners is starting to pay dividends. Speaking of dividends, investors will be glad to hearJohn Laing isn’t so hard up that it can’t pay another special dividend. The group will pay out an additional 4.88p per share this year, taking the total return to 10.61p.
The slump in reported pre-tax profit was driven by the movement in fair value on the group’s investment portfolio. An increase in fair value of £161m fell short of last year’s £214m rise, hurt by the impact of lower power price forecasts and adverse foreign exchange rates.
JOHN LAING GROUP (JLG) | ||||
ORD PRICE: | 248p | MARKET VALUE: | £910m | |
TOUCH: | 247.8-248.2p | 12-MONTH HIGH: | 322p | LOW: 248p |
DIVIDEND YIELD: | 2.2%* | PE RATIO: | 87 | |
NET ASSET VALUE: | 306p | NET DEBT: | 3% |
Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
2013 | 233 | 134 | 43.9 | nil |
2014 | 207 | 120 | 40.2 | nil |
2015 | 161 | 98.0 | 28.3 | 4.80 |
2016 (restated) | 261 | 192 | 51.9 | 5.55 |
2017 | 197 | 126 | 34.7 | 5.73 |
% change | -25 | -34 | -33 | +3 |
Ex-div: | 19 Apr | |||
Payment: | 18 May | |||
*Excludes special dividend worth 4.88p a share |