Eckoh (ECK) chief executive Nik Philpot said the UK business, which accounts for 63 per cent of group revenue, should be “back on track” after sales fell by 2 per cent to £18.8m due to weak turnover in the first half and less activity from partners such as Capita. The sales team has now been restructured, which led to a “much improved” second half. UK sales growth in the current financial year is expected to be in the mid- to high-single digits.
The US is set to be the focus for future growth at Eckoh as the American market is five times larger than that of the UK. Mr Philpot said the US has been slower to adopt some credit card security measures, but tighter regulation and more frequent cases of fraud will likely prompt operators to implement more secure payment measures. Eckoh currently has 46 clients in the US, up from 41 last year, but that’s only 1 per cent of the addressable market. Sales in America improved by 14 per cent to £11.1m during the year, led by strong growth in secure payments.
Analysts at Berenberg expect EPS of 0.6p in the year to March 2019, compared with 2.2p in FY2018.
| ECKOH (ECK) | ||||
| ORD PRICE: | 39.5p | MARKET VALUE: | £100m | |
| TOUCH: | 39-40p | 12-MONTH HIGH: | 55p | LOW: 37p |
| DIVIDEND YIELD: | 1.4% | PE RATIO: | 37 | |
| NET ASSET VALUE: | 9p* | NET CASH: | £3.6m | |
| Year to 31 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2014 | 14.0 | -1.40 | 0.10 | 0.31 |
| 2015 | 17.2 | -0.90 | -0.40 | 0.38 |
| 2016 | 22.5 | 2.40 | 0.90 | 0.45 |
| 2017 | 29.1 | 1.62 | 0.60 | 0.48 |
| 2018 | 30.0 | 2.44 | 1.08 | 0.55 |
| % change | +3 | +50 | +80 | +15 |
| Ex-div: | 27 Sep | |||
| Payment: | 26 Aug | |||
| *Includes £8m of intangible assets, or 3p a share | ||||
