The Group reported an impressive 21% uplift in EPS on 18% revenue growth and rewarded investors with a 15% DPS hike

Companies: Cineworld Group plc


In a lacklustre entertainment industry, some positive news this morning from Cineworld Group after they released their half year report for the 6 months to 30 June 2017.


Investors were rewarded with an increase in dividends per share of 15.4%, increasing to 6.0p from 5.2p the previous year. Revenue also grew by 17.8% in the same period, adjusted to 12.4% on a constant currency basis.


The strong performance can be attributed to positive growth in the UK and Ireland, with encouraging numbers also coming out of Eastern countries such as Poland, Romania, Bulgaria and Slovakia.

 

After downgrading the Group's stock to Hold in May, analysts from N+1 Singer have since upgraded the stock to Buy following today's announcement.

 

Whilst H1 and July trading was strong, the rest of Q3 is set to be tough. But, given the expected numbers Star Wars VIII is sure to bring in Q4. Singers go on to say:

 

"We will push through a modest 1% EBITDA upgrade for FY17 to take as 2% above consensus. This flaws through to a 1.5%/1% respective upgrade for FY18/19 also. We are now effectively estimating 12% H2-17 revenue growth (vs 9% previously) and 13% EBITDA growth."

In a market with stiff competition and an industry that has struggled to bring customers through the box office, Cineworld appear to be unfazed.

 


The information contained within this post is based on personal experience and opinion and should not be considered as a recommendation to trade nor financial advice.