AIM-quoted primary care buildings specialist Ashley House, positioned to benefit from Government-backed health spend, has maintained its profit momentum at the interim despite a short-term turnover blip.

For the half to October, profits before one-off items increased more than 20 per cent to £1.77 million, giving earnings of 4.5p and allowing for a 15 per cent dividend increase to 2.3p. Despite rising staff overheads, margins improved, buoyed by a broader business mix and growing income from high-margin design fees and asset management activities.

This represented an encouraging performance from Ashley House in the light of a drop in turnover from £12.8 million to just under £10 million, a reversal reflecting delays from Primary Care Trusts in approving funding for some new primary care schemes due to NHS reorganisation earlier this year. Though a short-term disappointment, Ashley House has a substantial pipeline of new business with which to fill its coffers in both 2008 and 2009.

As well as good progress from the core business – designing and delivering GP surgeries – the first six months saw first design fees from NHS LIFT, a Department of Health drive to develop and improve primary care facilities and a market in which Ashley House has a lucrative strategic alliance with Australian investment giant Babcock & Brown. This heavyweight tie-up holds the key to considerable sales and profits growth for the next two financial years.

By close of play, Ashley House shares were rooted on a 52-week low of 135p, down from a year’s peak of 189p and valuing the company at £37.2 million.

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Ashley House	AIM	£49.7m	114.00p	0.00p
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