Mattioli Woods (“MW”) has posted solid final results showing a beat (+9% vs SCMe) at the key adj. EBITDA level. Momentum is building: revenue growth in H2 was +12% vs H1 with a positive quarterly progression. This is encouraging for FY22e, which has started strongly (+10% Q1). Recent acquisitions are being integrated and offer a material step up in scale and earnings. We leave forecasts unchanged at this early juncture, noting potential for upside if trends are sustained. Once a full contributio
Companies: Mattioli Woods plc
Mattioli Woods has completed the small bolt-on acquisition of Richings – a £70m AuA financial planning business in Buckinghamshire. It is expected to be modestly earnings accretive in the first full year. Richings was one of the targets outlined as part of the recent £112m placing; which provided funding for the acquisitions of Maven, Ludlow and a four target bolt-on pipeline, of which Richings was one. We make no immediate changes, not expecting any material revisions (Richings generated only £
Mattioli Woods’ (“MW”) update for FY21 confirms profits in line with expectations – (SCMe Adj. EBITDA £15.9m). Revenues are guided to +7% YoY, slightly ahead of our +6% estimate and a product of improved inflows (>£480m net, now at £4.1bn AuM) and performance of discretionary portfolio managed services. A strong finish to the year, with momentum into FY22e . Client activity has continued to build with improvements in both new business and lead generation – we note, even against FY19’s pre-COVID
In May, Mattioli Woods (“MW”) announced the proposed acquisition of Maven and Ludlow, with an accompanying £110m equity placing. These acquisitions will near-double MW’s EBITDA (FY23e £39m from £22m). Maven has completed already with Ludlow expected in July. We expect £4m cross-platform revenue synergies in FY23e (vs MW stated £2m min). We forecast +10% FY23e first full year accretion (+2% FY22e part-year), growing to +18% FY23e if targets are delivered. The acquisitions of Maven and Ludlow repr
What a difference a year makes - 12 months ago, the focus, quite understandably, was on the course of the pandemic and the lifting of the Lockdown (1) measures. For investors, it was the sustainability of the rally in markets seen since March 2020. Today, while we are still thinking about the lifting of lockdown measures, we are also concerned about two “old favourites” from previous decades. Inflation and the parlous state of public finances. The BoE has said that although CPI inflation rose to
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Mattioli Woods has seen all shareholder resolutions approved at yesterday’s general meeting, confirming the conditional element of the £110m placing and clearing the way to completion for the transformational acquisitions of Maven Capital Partners and Ludlow Wealth Management. Both are expected to be accretive in the first full year of ownership. This pushes MW further towards the group’s long term strategic aspirations. We will update our formal forecasts with a more comprehensive review of the
Semper Fortis Esports* recently announced its intention to IPO onto the Access Segment of the Aquis Stock Exchange Growth Market. Semper is a multi-operational Esports organisation focusing on gaming technology solutions, brand enhancement and high growth team infrastructures. The company plans to raise £2.5m to develop their three core areas of establishing an esports team, forming partnerships with brands for sponsorship and B2B consultancy services. The Board are highly experienced in sports
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Mattioli Woods (“MW”) has announced another strategic acquisition, hot on the heels of the Pole Arnold deal (13/4). Caledonia AM is an Edinburgh-based WM and the deal will strengthen the Groups’ existing WM offering in an underserved market. Caledonia AM has c.£55m AuA from c.150 clients, with FY20 revs of £0.45m and PBT of £0.18m. Consideration is £0.96m up front (£0.86m net) and £0.64m contingent. Accounting for profitability targets against the contingent; paying c.8x EV/EBITDA and expected t
Mattioli Woods (“MW”) has announced another strategic, bolt on acquisition which is expected to be 5% EPS accretive in the first full year. Leics-based financial planner Pole Arnold has a similar culture to MW and provides fee-based financial planning. It is being acquired for £4m upfront – equating to an attractive 5x EV/EBITDA – with a further £3m contingent consideration based on profitability targets. We think MW’s current 14x FY22e PER (incl. full contributions from acquisitions this year)
The Budget offered a clear picture of the state of the economy. Put simply, the economy will be 3% smaller in three years’ time than it would have been without the impact of the pandemic. However, it is forecast to return to pre-pandemic levels by mid-2022, six months earlier than previously thought. The OBR forecasts that the UK economy will grow by 4.1% in 2021, (lower than the 5.5% outlined in November 2020). It has set its GDP forecasts in 2022, 2023 and 2024 at 7.3%, 1.7% and 1.6%. Positive
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Interim results are in line with our expectations. Revenue was slightly down yoy (-3%) as COVID reduced transactional activity, however, this was offset by recovering markets in Q2 which underpinned ad valorem revenues. With cost savings taking effect, adj. EBITDA grew 7% yoy: 56% of our FY21e and a 30% margin. We make no changes to our FY21e earnings forecast as trading remains positive. Strategic vision remains ambitious, with a revised target to treble AuA/M. Given strong recurring income, wi
Mattioli Woods has made a bolt-on acquisition: Montagu – a wealth manager with £80m AuA/M based in Twickenham, SW London – for (up to) £2.34m consideration, with £0.95m contingent on performance post-completion. This is small in a group context but another example of positive incremental growth, bringing a team with close cultural fit enhancing MW’s presence in South East England. We will make any (modest) changes at the Interims next week (9/2), with Montagu expected to be earnings enhancing in
Looking Ahead At The Next Week
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Mattioli Woods (“MW”) has issued a HY trading update indicating that performance remains in line with our current FY21e EBITDA forecasts. Activity levels were lower yoy but cost savings made at the end of FY20 remain in place. The group has now broken through the £10bn AuM/A milestone. The board has been strengthened with the appointment of three experienced independent NEDs. We make no changes to our forecasts: there is a juxtaposition of COVID uncertainty and better activity levels. Owing to e
There is no new trading information. We revisit our forecast positioning in light of market movements and US Election outcome. We believe industry trends are positive – an increasing propensity to seek advice/invest irrespective of uncertainty. We make no changes to estimates, but should these trends continue we see potential upside. MW has strong earnings quality (90%+ recurring revenue, 50%+ revenue not linked to value of assets) which is deserving of a premium. We note strengthening of the Cu
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Open Orphan has released its H1 2021 results. The numbers represent a milestone for the Group, delivering both positive EBITDA and bottom line profits in its half year for the first time. While H2 looks slightly uneven, this remains a rapidly growing business in a market increasingly well understood by investors and with significant opportunity for high returns in 2022 and beyond, there remains lots to go for. Reiterate Buy.
Companies: Open Orphan Plc
Begbies has issued an AGM update that confirms the group has had a good Q1 with double-digit revenue and profit growth, benefiting from a contribution from recent acquisitions which management has confirmed are performing in line with expectations and a recovery in activity levels within the Property division. Management has also confirmed that the group is on track to meet market expectations for the full year. As we have said previously, a return to pre-pandemic insolvency volumes would offer
Companies: Begbies Traynor Group plc
Interim results showed a 240% (+£15.2m) increase in proforma revenues to £21.9m, with sequential half-yearly growth of 55% (+£7.8m), driven principally by non-COVID-related studies. The company has guided to revenues (including other income) of c.£40m in 2021 and is targeting c.£50m in non-COVID revenue in 2022, with any COVID-related revenue being in addition to this. The shortfall from our previous 2021 estimate of £46m is attributed predominantly to the ongoing completion of a COVID challenge
Accelerating platform change aims to diversify revenues, improve business mix and lower operating costs. The bulk of this transition should be complete by summer 2022 in time for the seasonally important fourth quarter for US sports betting. The changes wrought across the organisation will hike exceptional costs in our forecasts but tangible benefits should be felt from the H2 2022E onwards.
Companies: XLMedia Plc
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Braemar has confirmed H1 trading (to August) has been strong. The new strategy, with its revitalised focus on Shipbroking, is driving growth supported by the recent investment to increase the strength and diversity of services. Shipbroking has benefited from investment in the Dry Cargo and Securities desks and the Sale and Purchase desk has also been very active. While the tankers market has remained subdued, there are indications that demand will strengthen as global demand for oil recovers. Th
Companies: Braemar Shipping Services plc
Exactly one year ago, the FTSE 100 closed at 5,862, having fallen 100 points on the day, the lowest point since mid-May 2020, due in part, to the strength of sterling vs US$ at $1.34. One year on, the FTSE 100 has risen to 7,119, a rise of 21%, it remains 7% below the peak in January 2020. From an international viewpoint, US and European markets continue to trade at record highs. The US Federal Reserve is close to withdrawing some of its economic support this year as inflation picks up and the e
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What’s new: Fintel’s interims are in line with its July trading update which (i.e. 10% revenue growth and 12% EBITDA growth) and provided colour on the impact of recent strategic disposals (i.e. Zest Technologies and Verbatim funds).
Companies: Fintel PLC
Today's results echo the messaging of June's detailed trading update, confirming a resilient FY21A result over a COVID-19 affected year. Whilst current market conditions remain challenging (given the large degree of government support provided to SMEs over the pandemic), we expect net origination growth to return over FY22E, as the economy rebounds, driving future revenues. While profit growth will be tempered by investment in FY22E, we expect a strong earnings delivery of +63% in FY23E, as retu
Companies: Time Finance plc
Joiners No joiners today. Leavers Plutus Powergen has left AIM. What’s cooking in the IPO kitchen? Eurowag confirms its intention to undertake an initial public offering on the Main Market (Premium). The Offer would be expected to comprise both (i) new Ordinary Shares to be issued by the Company, raising gross proceeds of approximately EUR200m to support Eurowag's growth strategy and (ii) existing Ordinary Shares to be sold by existing Eurowag shareholders. Eurowag is a leading pan-European
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RBG’s interims offer no surprises, with performance strong across all divisions and progress on track against our FY21e forecasts (Revs: £45.5m, Adj. EBITDA: £11.8m). The Group’s diversified revenue model has proved resilient against a continued backdrop of uncertainty – driving revenues +53% YoY against a somewhat weak comparative, split +35% organic, +18% from Memery Crystal (despite only one month of contribution). Demand for services across all three businesses remains strong, and management
Companies: RBG Holdings Plc
Silverbullet is a fast-growing digital marketing transformation services and product company serving a blue-chip client base. Silverbullet’s “killer-app” is its recently launched 4D contextual advertising solution designed to help advertisers target consumers in a post-cookie world.
Companies: Silver Bullet Data Services Group plc
Trading during the first quarter (May to July 2021) was in line with expectations. BEG remains on track to achieve our revenue and adjusted profit forecasts, which are unchanged. As anticipated, the components of forecast double-digit percentage growth in revenue and profits this year are internally driven, rather than market related: specifically recent acquisitions and the bounce back from 2020’s lockdowns.
This morning's H1 announcement reflects a 6-month period during which VDTK faced a number of challenges, notably (1) economic uncertainty, (2) postponement of projects in the pipeline due to Covid restrictions, and (3) theft of stock from the Lainate plant leading to a £300k write off. Including the stock charge, the company has reported a post-tax loss of £1.2m, similar to or better than, on an underlying basis, the £0.9m loss recorded in H1-20A. All of this said, however, the period also saw
Companies: Verditek Plc
FY21 results (to 31 May) are in line with expectations. While business volumes and revenue were hit by the pandemic slowdown, Time stayed profitable (unlike many other lenders) with cost cutting measures actually boosting margins, and the balance sheet remaining strong. New CEO Ed Rimmer has already started to lay the foundations for a return to growth, and is looking to double the size of the lending book over four years through organic growth.
