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RWS Holdings (LON:RWS) - just keeps on delivering!
Posted 14/12/10
The leading provider of intellectual property support services (patent translations and technical searches) and technical translations, announced encouraging preliminary results for the year ended 30th September 2010 broadly in line with forecasts with the dividend payout increased again.
Sales increased by 9.6% to £60.6m, profit before tax rose by 0.7% to £14.6m and diluted adjusted earnings per share were marginally up at 24.9p(2009: 24.6p). The final dividend of 10.25p was up over 15% as was the total dividend which increased to 13.4p (2009: 11.65p), continuing an unbroken series of double digit dividend increases since flotation. This equates to a yield of 4.6% at the current share price.
Adverse movement in exchange rates had a negative impact of £0.3m at constant currency. Excluding intangibles amortisation and the £0.4m one-off costs of relocating the group’s operations, normalised operating profit rose by 2.9% from £13.9m to £14.3m (WHI £14.1m).
The group remained in a strong cash position at year end with net cash of £17.9m (2009: £24.3m), after purchase cost of new office building (£10.0m) and prior to recovery of associated VAT of £1.6m.
Despite substantial growth in patent translations business with significant client wins in Europe and North America they experienced challenging trading conditions in technical translations, particularly in Germany; thankfully these stabilised in the fourth quarter. Encouragingly the Chinese business grew revenue by 47% and moved into profit.
Management commented that trading in the first two months of the new financial year has been encouraging and the euro and dollar trading exposure has been hedged at €1.15 and $1.54.
The valuation at c11.2x Sept 2011 forecasts looks modest if one considers the rock solid Balance Sheet and the large amount of cash remaining to support further acquisitions. One to follow in 2011!
This entry was posted 1 year, 5 months ago and was filed under RWS Group.
