Healthcare advisory group Cello Health (CLL) is continuing to capitalise on opportunities in the US, with over a third of overall net revenue now coming from across the pond. For its namesake Health division, the US contribution increased to almost 50 per cent in the first half of 2019.
Accounting for almost two-thirds of overall net revenue, healthcare is continuing to propel organic growth – excluding the impact of acquisitions and start-ups, the business saw like-for-like constant-currency growth of 8.2 per cent. This was driven by increased activity in both communications and consulting as existing clients in the US and UK increased their spending, and the group secured a number of large biotech projects.
Meanwhile, performance in the marketing and communications segment was more muted, weighed down by the social media software sales business, Pulsar. Excluding this unit, the core Signal business saw adjusted operating profit rise by 17 per cent on the back of a 1.4 percentage point margin expansion.
Since Facebook’s exit in 2017, the social media analytics market has slowed and Pulsar’s US operation remains in an (albeit smaller) £0.4m operating loss position. Due to be reported separately from January 2020, chief executive Mark Scott says Pulsar is “under review” as the group looks at how to best exploit opportunities in this space.
House broker Cenkos forecasts adjusted pre-tax profit of £12.6m and EPS of 9.1p for the full year, rising to £13.7m and 9.9p in 2020.
| CELLO HEALTH (CLL) | ||||
| ORD PRICE: | 126p | MARKET VALUE: | £134m | |
| TOUCH: | 125-127p | 12-MONTH HIGH: | 140p | LOW: 95p |
| DIVIDEND YIELD: | 3.1% | PE RATIO: | 17 | |
| NET ASSET VALUE: | 84p* | NET CASH: | £2.2m** | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2018*** | 77.2 | 3.33 | 2.36 | 1.10 |
| 2019 | 79.5 | 4.66 | 3.31 | 1.15 |
| % change | +3 | +40 | +40 | +5 |
| Ex-div: | 3 Oct | |||
| Payment: | 1 Nov | |||
| *Includes intangible assets of £75m ,or 71p a share, **Excludes lease liabilities of £10.5m, ***Restated | ||||
