Latest Results
Results for the six months ended 30 September 2011
Strong first-half results
Continuing good prospects
Summary of results
Six months ended 30 September 2011
| 2011 | 2010 | Change | |
| Revenue | £186.8m | £169.2m | +10% |
| -Underlying earnings (1) | |||
| -Operating profit | £23.4m | £19.5m | +20% |
| - Operating profit margin | 12.5% | 11.5% | +1.0 pp |
| -Profit before tax | £18.7m | £15.3m | +22% |
| - Earnings per share | 4.1p | 3.3p | +24% |
| - Reported earnings | |||
| - Operating profit | £21.3m | £17.5m | +22% |
| - Profit before tax | £16.6m | £13.3m | +25% |
| - Earnings per share | 3.6p | 2.8p | +29% |
| Interim dividend per share | 0.6p | 0.5p | +20% |
| Net debt | £68.9m | £85.8m | -£16.9m |
| Free cash outflow (2) | (£0.7m) | (£6.1m) | +£5.4m |
Financial Highlights
- Revenue up 10% to £187m, up 6% at constant currency (2010: up 6% at constant currency) with growth across all travel regions and Spendvision
- Underlying operating profit margin up from 11.5% to 12.5%
- Profitability up across all travel regions and Spendvision
- Cost management demonstrates continued flexibility
- Underlying EPS up by 24% to 4.1p
- Free cash flow (2) improvement of £5.4m for the six months
- Net debt down £16.9m from September 2010 at £68.9m; equivalent to 1.2x EBITDA(3) (2010: 1.6x)
- New UK triennial pension valuation finalised with a modest increase in cash contributions
- Interim dividend up 20% to 0.6p per share (2010: 0.5p per share)
- Full-year dividend to be at least 1.8p per share (+20% over last year)
Operational Highlights
- Client travel transaction activity up 7% (2010: up 18%)
- Client travel spend up 13%, up 9% at constant currency (2010: up 18% at constant currency)
- Client retention rate remains above 90%
- HRG enters exploratory discussions with American Airlines on ‘direct connect’
- New business wins including AIG, Allianz, CGI, CSL, MMG and Posten Norge
- New sales pipeline provides further support for growth
David Radcliffe, Chief Executive of Hogg Robinson Group plc, said:
“The strong first-half performance continues the momentum we reported earlier in the year. This steady and consistent growth serves to highlight the strength of our business model, which is underpinned by our ability to help clients maximise the value of their corporate travel budgets.
“Our strong cash flow has reduced net debt over the last 12 months and recently we have reached a positive agreement with the UK pension trustees which provides greater certainty regarding funding.
“We remain mindful of prevailing macroeconomic uncertainty but have confidence that our compelling customer proposition, strong foundations and momentum will see HRG deliver a full year in line with expectations.”
Notes:
(1) Before amortisation of acquired intangibles
(2) Free cash flow is the change in net debt before acquisitions and disposals, Employee Benefits Trust purchases, dividends and the impact of foreign exchange movements
(3) Earnings before interest, tax, depreciation and amortisation (EBITDA)
For further information contact:
Hogg Robinson Group
+44 (0)1256 312 600
David Radcliffe, Chief Executive
Julian Steadman, Group Finance Director
Angus Prentice, Head of Investor Relations
Tulchan Communications
+44 (0)20 7353 4200
David Allchurch
Stephen Malthouse
Martin Robinson