Update: Maiden interims show strong profit growth
NAHL’s maiden interim results show underlying 26% continuing operating profit growth on a 6% growth in continuing operations revenue (driven by enquiry growth and online lead conversion performance). This results in a significant rise in solicitor income margins following the introduction of the group’s new pricing model on 1 April 2013. Management indicates that current trading is strong and the outlook remains positive. Supported by this and the FY14 interim data, we raise our FY14 and FY15 underlying PBT and EPS estimates. Net debt fell to £2.0m aided by high operating profit cash conversion. An interim 5.0p DPS suggests a total FY14 15.0p dividend based on the group’s stated dividend policy and hence an attractive 7.8% yield.NAHL Group is a marketing and services business focused on the U.K. consumer legal market. Co. operates across the Personal Injury division through its subsidiary, National Accident Helpline Limited, which validates the legitimacy of consumers' claim and connects them to a law firm. Co. operates across the Critical Care division through its subsidiary, Bush and Company Rehabilitation Limited, which provides case managers and witnesses to solicitors and insurance companies in support of injury victims. Co. operates across the Residential Property division through its subsidiaries, Fitzalan Partners Ltd and Searches U.K Limited, which provides conveyancing, searches and survey services.
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