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Expansion-hungry Gateley reports record revenue figure

By Josh White

Date: Tuesday 16 Jul 2019

Expansion-hungry Gateley reports record revenue figure

(Sharecast News) - Legal and professional services group Gateley reported a 20.2% improvement in revenue in its preliminary results on Tuesday, to £103.5m.
The AIM-traded firm said adjusted EBITDA rose 15.7% in the year ended 30 April to £19.1m, while profit before tax improved 8.9% to £15.9m.

Profit after tax was ahead 10.6% over the prior year at £13.0m, with basic earnings per share increasing 7.3% to 11.83p and adjusted fully diluted earnings per share ahead 17.8% at 13.15p.

The board proposed a final dividend of 5.4p per share, up from 4.8p in the prior year, and representing a full-year dividend of 8.0p per share - an increase of 14.3%.

Gateley said it had a "robust" balance sheet, with net assets at £30.6m at year-end, up from £23.0m, and net debt at £3.2m, rising from £0.7m.

It said it saw "strong" cash generation and continued investment for future growth, and added that the new financial year had started well, with the group well positioned to make further progress.

On the operational front, the company pointed out that its revenue was "record breaking", as was its staff numbers, with three acquisitions completed and fully integrated in the year.

Those included the strategic acquisition of housebuilder specialists GCL Solicitors in May 2018, and the complementary acquisitions of non-legal human capital consultancy business Kiddy & Partners in July, and non-legal inward investment consultancy business International Investment Services in November.

The firm said it made a continued investment in fee-earning staff, with average numbers up 19.8% to 610, and average total staff numbers ahead 19.8% at 907.

It reported increased levels of partner recruitment, with organic growth momentum maintained.

The introduction of a new long-term incentive plan was replacing the stock appreciation rights scheme, with the board saying it would increase clarity on dilution.

It said the long-term investment plan would sit alongside the existing company share option plan and 'save as you earn' staff option schemes.

A new five-year orderly market agreement was being finalised, the board added.

"I am delighted that our legal and professional services group has broken the £100m revenues barrier for the first time, as we delivered another excellent financial performance whilst continuing to take advantage of opportunities to diversify revenue streams through complementary acquisitions," said chief executive officer Michael Ward.

"Our teamwork has, once again, enabled us to maintain strong momentum."

Ward said the company had continued to invest in its people, with staff numbers now approaching 1,000 employees, adding that it had its "most active year" to date on strategic acquisitions, all of which were successfully integrated.

"The new financial year has started very well and we continue to look to the future with confidence."

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