18th May 2022 15:12
(Alliance News) - Magazine publisher Future PLC's strong interim results were a "useful reminder" of the company's "underlying attractions", Shore Capital said on Wednesday.
"We continue to view Future as a well-managed business whose strategic focus on technological investment in leveraging engaging content to drive e-commerce and digital advertising across a broad portfolio of B2C brands is a potent medium-term growth driver. We also and growing global digital footprint a key positive in this regard," Shore said.
The stockbroker holds a 'buy' rating on Future, believing the firm's growth potential has been "substantially undervalued".
Future was trading at 1,874.00 pence in London on Wednesday afternoon, down a sharp 8.8% on the day, reversing the strong gains seen earlier in the session. In 2022, the shares are down 51%.
For the six month period that ended on March 31, the Bath, England-based Future's revenue was GBP404.3 million, up 48% from GBP272.6 million in the same period last year.
The rise in revenue reflects a combination of organic growth and contribution from acquisitions, the company noted.
Pretax profit rose by 42% to GBP81 million from GBP56.9 million in the previous year.
Shore analyst Roddy Davidson said: "Today's interim results provided a useful reminder of Future's underlying attractions, attractive medium-term growth potential and cash generative characteristics."
Shore said the firm's revenue, operating profit and earnings per share were ahead of the stockbroker's forecasts by 48%, 48% and 27%, respectively.
Future also made a modest upgrade to its guidance for financial year 2022, on the back of improving margins and the recent acquisition of digital-only women's lifestyle publisher WhoWhatWear.
Adjusted operating margin widened to 33% in the first half from 32% in all of financial 2021.
"It is also clear that organic growth is likely to be supplemented by further complementary acquisitions as the company looks to build on a positive track record in that regard," Davidson added.
Future Chief Executive Zillah Byng-Thorne said: "Through the continued execution of our strategy, we have delivered robust year-on-year growth despite an inflationary environment and prior year comparators enhanced by the impact of Covid-19.
"We are pleased to be on track to deliver another strong full-year of profitable growth despite the wider macroeconomic outlook."
By Paul McGowan; [email protected]
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