Acquisitions underpin outlook in recovering markets
Strong FY21 results were in line with our most recently upgraded forecasts (May 2021) and reinforce our conviction that BEG is set to deliver material earnings growth over the next few years.Recovery in corporate insolvency volumes will drive organic growth, as government support is gradually withdrawn. Volumes are currently artificially suppressed i.e., near thirty-year lows, well below a ‘normal’ cycle for the UK economy. Simple restoration of the latter would deliver a significant increase y-o-y, which should benefit BEG as the UK’s leading independent provider.
BEG appears to have very effectively shrugged off much of the impact of the pandemic and demonstrated an ability to outperform its underlying markets. Revenue from new insolvency appointments was in line y o y despite a 34% overall market decline. In the context of subdued corporate insolvency volumes, the results are especially impressive.
The FY21 results complete a five-year period during which BEG has delivered annualised (CAGR) growth in revenues and adjusted EPS of 14% and 20% respectively (50:50 organic/acquisition) and paid down all debt despite completing 13 value-enhancing acquisitions.
We have held our FY22e forecast and 165p/share fair value estimate.
Begbies Traynor Group is a business recovery, financial advisory and property services consultancy. Co. provides these services through two operating segments: business recovery and financial advisory services, which provides transactional support, valuations and advisory services through its subsidiary, BTG Financial Consulting LLP; and property services, which delivering advisory, such as commercial property valuations, property receiverships, property management and accounting, and as well as transactional services that include property auctioneers, machinery and business asset auctioneers to owners and occupiers of commercial property, investors and financial institution.
Mattioli Woods provides pension consulting and administration, wealth management, asset management and employee benefits consultancy. Co.'s operating segments comprise:Pension consultancy and administration, which include setting up and administering pension schemes, as well as providing consultancy services for one-off activities; Investment and asset management, which manages and placing of investments on behalf of clients; Property management, which manages collective property investment vehicles, facilitates direct commercial property investments on behalf of clients; and Employee benefits, which assists its corporate clients with employee engagement.
Equity Development enables companies to become better understood and supported by investors. Since our launch in 1996 we have consistently focused on helping our clients improve their communication and relationships with both existing and potential shareholders. Our clients have come from a wide variety of sectors and domiciles, are both private and quoted and range in size from micro-cap to $multi-billions. We offer free access to company research notes written by experienced analysts. These notes include detailed forecasts, financial models and a fair value. We host regular Private Investor Forums at which investors have the opportunity to hear company directors present, and to ask questions. These are free to attend. We broadcast live Webinars with company management that include active Q&A. We also make the recordings available online. We arrange face to face meetings between private investors and company management. We are active users of Twitter, commenting daily on company news, share price moves, Directors’ Dealings, Equity Development Research Notes & Events.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.