2nd Feb 2015 10:53
LONDON (Alliance News) - Murgitroyd Group PLC Monday said it is on track to meet its full-year expectations after it reported higher revenue but lower pretax profit for the first half of the year, in line with its hopes.
The company reported revenue of GBP19.3 million for the six months to November 30, up slightly from GBP19.2 million a year earlier, but its pretax profit fell to GBP2.0 million, from GBP2.3 million, as it invested in new business and made a greater proportion of its revenue in the US where margins are currently lower. Its US revenue rose 22% on the year to GBP7.5 million.
The patent and trade mark attorney group raised its interim dividend to 4.26 pence a share, from 3.75p last year, reflecting its pledge to adopt a higher payout ratio due to the consistently cash generative nature of its business. It also expects to increase its final dividend for the current financial year.
It said continuing strong cashflow meant it had net cash of GBP288,000 at the end of Novermber, compared with a net debt of GBP827,000 a year earlier. That meant interest charges fell to GBP13,000, from GBP21,000.
The company is investing in expanding in the US, as part of a strategy of diversifying away from the stagnating European patent market. The US now accounts for about 38% of the company's total revenue.
"In a fairly difficult trading environment, these results are encouraging and the board is confident in the group's ability through ongoing investment and an established market presence to deliver sustainable, long-term growth and value to shareholders," the company said.
"We continue to seek earnings enhancing acquisitions and we are pleased to report that trading is in line with market expectations," it added.
Murgitroyd Group shares were down 2.1% at 480.00 pence Monday morning.
By Steve McGrath; [email protected]; @stevemcgrath1
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