22nd Feb 2024. 9.00am

Regency View:


Regency View:


Alpha FMC’s resilience in challenging markets

Global financial services consultancy, Alpha Financial Markets Consulting (AFM) recently provided a trading update for the fiscal year ending March 31, 2024.

In the midst of a more competitive consulting market, Alpha FMC faced a longer sales cycle, resulting in a slower-than-expected start to trading in January.

This slower start impacted consultant utilisation in Q4, but the Group projects an overall improvement in utilisation through the rest of the quarter.

Financially, the Board expects FY 24 results to demonstrate net fee income growth of up to 5% and adjusted EBITDA of £42m – £43m, maintaining a slightly improved margin compared to the first half.

Despite market challenges, Alpha FMC has navigated by maintaining consistent day rates, selectively hiring in key growth areas, and actively managing its cost base. The Group also maintains a strong net cash position.

Looking ahead, Alpha FMC sees robust client demand and has experienced higher sales wins in recent months, maintaining a strong pipeline of new business opportunities. CEO Luc Baqué expressed confidence in the Group’s position for continued growth, emphasising improving market conditions and the Group’s compelling proposition to clients.

AFM Daily Candle Chart

AFM Daily Candle Chart

Alumasc report robust interim results and optimistic outlook

Sustainable building products supplier, Alumasc (ALU) released its interim results for the six months ending December 31, 2023.

In a challenging environment, Alumasc outperformed underlying construction markets, with UK sales proving resilient and strong overseas sales contributing to a 6% growth in Group revenue and a 12% increase in underlying profit before tax.

Key points from the interim results included:

  • Revenue growth: Group revenues increased by 6.4% to £47.8m, demonstrating organic growth resilience across Water Management, Building Envelope, and Housebuilding Products.
  • Operating margin: The underlying Group operating margin reached 14.1%, showing strength in Water Management (16.0%) and a record margin in Housebuilding Products (24.5%).
  • Profit growth: Underlying profit before tax grew by 12.4% to £6.3m, attributed to increased volumes, effective price and cost control, contributing to reported profit before tax of £5.6m.
  • Financial position: Net bank debt at December 2023 was £7.4m, comfortably within the bank covenant, reflecting a gearing of 0.5x.
  • Dividend increase: The interim dividend per share increased to 3.45p, reinforcing confidence in the Group’s financial position.

CEO Paul Hooper expressed satisfaction with the first half’s performance, highlighting the strategic acquisition of ARP Group and emphasizing exciting synergies and cross-selling opportunities that align with the Group’s growth ambitions.

ALU Daily Candle Chart

ALU Daily Candle Chart

Eckoh achieves record contracted business

Eckoh (ECK), the global provider of Customer Engagement Data Security Solutions, announced a significant update on its total contracted business and new contracted business for the second half of its fiscal year 2024.

In H1 FY24, Eckoh secured a record level of business totalling £24.6m. The momentum continued into H2, with over £20m of additional contracted business closed since October 1st, 2023. As of January’s end, the Group has achieved a record total contracted business of £45m year-to-date, with approximately £18m attributed to new business.

Several sizable enterprise deals, initially scheduled for H1, were successfully closed in H2, contributing to £12m of new contracted business. Notably, North American contract wins make up £9.9m ($12.3m) of this total, including contracts with a US travel technology company, a leading US homecare business, one of the largest paediatric organisations in the US, and a Fortune 500 office supplies retailer.

The strategic focus on cloud-delivered solutions is evident in these contracts, aligning with the Group’s objectives to increase cloud-generated revenue and cross-sell additional solutions. Noteworthy UK wins include a £2.3m 3-year contract with a media & telecommunications provider.

Eckoh’s Board anticipates further contract closures before the fiscal year’s end on March 31, 2024, reinforcing confidence in Eckoh’s growth prospects.

ECK Daily Candle Chart

ECK Daily Candle Chart

FRP Advisory declares Q3 dividend

FRP Advisory (FRP) released a trading update for the nine months ending January 31, 2024, along with the declaration of its Q3 dividend.

Recognizing substantial progress in the first three quarters of FY 2024, FRP’s board expressed confidence in meeting market expectations. Ongoing trading activity remains in line with anticipated levels, with a full trading update for FY 2024 scheduled for mid-May 2024.

FRP said its resilient balance sheet and a favourable net cash position has allowed the board to declare a Q3 dividend of 0.9p per share. Shareholders listed on May 17, 2024, will receive the dividend on June 14, 2024, and the ex-dividend date is set for May 16, 2024.

FRP’s confidence in the market trajectory is evident through their outlook, anticipating consensus market projections for FY 2024, including revenue of £123m and adjusted earnings (EBITDA) of £32m.

FRP Daily Candle Chart

FRP Daily Candle Chart

Gattaca achieves strategic wins and maintains focus on growth

Gattaca (GATC) a released a solid trading update for the six months ending January 31, 2024.

In terms of financial performance, Group Net Fee Income (NFI) is anticipated to be £18.9m, showing a 16% YoY decrease from £22.5m in H1 23.

The NFI composition reveals a shift towards Contract (76%) and Permanent (24%), compared to H1 23 (68% / 32%). This reflects an increased focus on the contract market while maintaining flat contractor volumes.

Permanent NFI witnessed a decline of 38% YoY due to market weakness and continued weakness in placements since the start of the year. The exit of a large permanent Recruitment Process Outsourcing (RPO) client in the prior year further contributed to this decline.

On the business development front, the Group demonstrated significant progress, securing two large client extensions and winning two more Managed Service Provider (MSP) contracts.

The Defence sector stands out as the Group’s strongest performer, showing 9% YoY growth, excluding the exit of the RPO account.

Sales headcount saw a marginal reduction to 312 from 315 at the year-end. The Group expects to report statutory net cash of £22.1m at January 31, 2024, compared to £21.6m at July 31, 2023.

Looking ahead, despite challenging market conditions, Gattaca said it is likely to trade in line with current market expectations. The strategy to invest in business development is yielding positive results, with a growing pipeline and high engagement.

GATC Daily Candle Chart

GATC Daily Candle Chart

Jet2 expects profit surge with strong bookings and strategic investments

Jet2 (JET2) reported a positive trading update for the year ending March 31, 2024 (FY24), and provided insights into the year ending March 31, 2025 (FY25).

For FY24, despite a substantial 20.5% increase in on-sale seat capacity, Winter 2023/24 forward bookings showcased strength, with passenger sectors booked up by 17%. Average pricing for flight-only and package holiday products remained robust. Approximately 60% of higher-margin per passenger package holiday customers contributed positively to the performance.

The Group tightened and slightly raised its guidance for FY24 profit, ranging between £510m and £525m (previously £480m to £520m), contingent on no material extraneous events in the remaining fiscal year.

Looking ahead to FY25, on-sale seat capacity for Summer 2024 was notably higher, up by 12.5% compared to Summer 2023 at 17.2 million seats. Encouraging forward bookings indicated an average load factor 1.5 percentage points ahead of Summer 2023 at the same point. Package holiday customers increased by 17%, constituting approximately 77% of total departing passengers.

Significant investments were made, including the delivery of new A321neo aircraft and the operational launch of the Liverpool John Lennon Airport base on March 28, 2024. Positive booking momentum was observed, but challenges arose from increased input costs, including hotel accommodation and changes to the EU Carbon Emissions Trading Scheme. While pricing for Summer 2024 showed an increase compared to the same period last year, the Group remained mindful of the then-current macro-economic and geo-political environments.

CEO Steve Heapy expressed confidence in customer loyalty, anticipating continued travel to popular destinations despite economic and geopolitical uncertainties. Further updates are expected in April 2024, with Preliminary Results for FY24 announced on July 11, 2024.

JET2 Daily Candle Chart

JET2 Daily Candle Chart

TPXimpact on track for FY24 targets

TPXimpact (TPX) reported a robust Q3 performance in line with achieving its FY24 financial targets.

Q3 revenues showcased a 32% increase in like-for-like figures, reaching £20.2 million, contributing to a year-to-date revenue growth of 25% to £61.8 million. New business wins for the first nine months totalled £130 million, including £25 million in Q3, and the pipeline for upcoming projects remained promising.

As of December 31, 2023, net debt (excluding lease liabilities) decreased to £10.7 million from £12.8 million at the end of September 2023, highlighting effective working capital management.

TPX successfully implemented its plan to simplify its business structure by establishing the Digital Transformation platform, officially launching on April 1, 2024. The platform will encompass three segments: Digital Transformation, Digital Experience, and KITS, streamlining operations for clients and stakeholders.

FY24 targets include revenue in the range of £80-85 million (equivalent to like-for-like revenue growth of 15-20%) and Adjusted EBITDA in the range of £4-5 million (an Adjusted EBITDA margin of 5-6%). Management also targeted net debt (excluding lease liabilities) of around £11 million at March 31, 2024, aiming for a net debt to Adjusted EBITDA ratio of <2.5x by the end of FY24.

Looking ahead to FY25, TPX anticipates like-for-like revenue growth of 10-15%, further margin improvement of 2-3%, and a solid foundation with approximately £65 million in committed revenues.

TPX Daily Candle Chart

TPX Daily Candle Chart

Water Intelligence achieves strong 2023 results, acquires Pittsburgh franchise

Water Intelligence (WATR) reported a strong 2023 performance in line with market expectations, coupled with the acquisition of its Pittsburgh franchise by its American Leak Detection (“ALD”) subsidiary. Despite challenges from rising interest rates and persistent inflation affecting consumer spending decisions, the Group maintained its growth momentum into 2024.

Financially, Water Intelligence achieved positive results in 2023, with revenues growing by 7% to $76.0 million, statutory Profit Before Tax increasing by 13% to $6.2 million, and Adjusted Profit Before Tax rising by 12% to $8.7 million. Margins improved, with Adjusted PBT margins reaching 11.5%, and Adjusted EBITDA margins reaching 17.7%. The balance sheet remained robust, with cash of $15.8 million and Total Debt of $22.8 million.

The Group successfully executed its strategic plan of organic growth and acquisitions, with technology investments and acquisitions contributing to its performance. Notable acquisitions included ALD franchises in Nashville, Tennessee, and Covina, California. The deployment of technology investments, such as Salesforce CRM software and proprietary products, is expected to drive sales growth in 2024.

Water Intelligence reacquired its Pittsburgh franchise for $0.5 million, anticipating increased growth opportunities for the location. Compensation for certain Board members and employees was issued in shares to align with the Company’s growth strategy.

2023 Highlights:

  • Group Revenue increased by 7% to $76 million.
  • Franchise-related activities grew 6% to $11.3 million.
  • Adjusted EBITDA grew 9% to $13.4 million.
  • Adjusted PBT grew 12% to $8.7 million.

2024 Outlook:

The Group expressed confidence in its strategic growth plan and emphasized its strong balance sheet, enabling continued investment in capital projects to support long-term growth. The expectation is to communicate more effectively with the market through video and social media, aiming to take a leadership position in the market with its differentiated technology brand and expanding operating footprint.

The audited full-year results for the year ended 31 December 2023 are expected to be announced by early June 2024.

WATR Daily Candle Chart

WATR Daily Candle Chart


All content is provided for general information only and should not be construed as any form of advice or personal recommendation. The provision of this content is not regulated by the Financial Conduct Authority.