MeetingZone – the conferencing services provider that LoopUp (LOOP) bought last June for £61.4m, supported by a £50m share placing – is already singing for its supper. Group revenues nearly doubled, and annualised cost synergies are “materially above” the £3m targeted at the time of the acquisition. It's bedding-n well.
There were other positive signs, including the fact that LoopUp has won 55 new clients in Australia to date, having only entered the region last March. Clients included the country’s largest law firm.
That said, the average number of 'quota-effective pods' (sales teams running at full capacity) was 7.5 – below expectations of 11. This was because of “necessary pipeline build” in Australia, and the decision not to move any MeetingZone employees onto LoopUp pods. In turn, organic constant-currency revenues grew by just a fifth, against an average of 32 per cent between 2015-17.
To increase pod numbers, LoopUp has completed its first-ever ‘Pod Academy’ scheme, culminating in the graduation of 14 career-change recruits. The group will inject another £2m into the initiative in 2019.
House broker Panmure Gordon has lowered its profit forecasts for 2019 and 2020, to reflect investment. It expects adjusted EPS of 11p in 2019, up from 9.3p in 2018.
| LOOPUP (LOOP) | ||||
| ORD PRICE: | 355p | MARKET VALUE: | £196m | |
| TOUCH: | 345-365p | 12-MONTH HIGH: | 503p | LOW: 275p |
| DIVIDEND YIELD: | nil | PE RATIO: | 142 | |
| NET ASSET VALUE: | 109p* | NET DEBT: | 18% | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2014 | 8.0 | -1.54 | na | nil |
| 2015 | 10.1 | -1.09 | -2.4 | nil |
| 2016** | 13.6 | -0.29 | 0.6 | nil |
| 2017 | 17.5 | 0.73 | 4.8 | nil |
| 2018 | 34.2 | 0.39 | 2.5 | nil |
| % change | +96 | -47 | -48 | - |
| Ex-div: | na | |||
| Payment: | na | |||
*Includes intangible assets of £62.8m or 114p a share **Floated on Aim in August 2016 | ||||
