02/09/2005
Business-to-business media play Tarsus has delighted investors with maiden interim profits – the strong first half performance and bumper levels of cash generated mean shareholders receive a maiden 1p interim payout. Tarsus, which sports interests in exhibitions, conferences and publishing, scored pre-tax profits of £500,000 in the period to 30 June, an encouraging turnabout from losses of £300,000, on a 76% sales leap to £7.9m. Adjusted profits burgeoned by £1m to £800,000. Managing director Douglas Emslie attributed the excellent results to strong organic sales growth of 32%, new launches and a first-time contribution from last year’s French acquisitions. During the half, US operations performed strongly, with sales up 20% at £2.4m and profits powering ahead by 44% to £800,000. A key development was the staging of two new exhibitions in the packaging market, one Tarsus is well-equipped to exploit with its expertise in the labelling arena. Elsewhere European revenues sped 70% higher, with acquisitions providing a shot in the arm to the improving French performance. And in the emerging markets – Latin America and China – sales rose to £500,000 (£200,000) although losses were posted following investment in the launch of the Beijing International Travel and Tourism Market business-to-business outbound travel show in China. Emslie expects that event to reach profitability in 2007. Tarsus’s main events, including the year’s major show, Labelexpo Europe, take place in the second half, and the group’s visibility is extremely high, with exhibition bookings for the year standing at 95% of forecasts. For December 2005, analysts are forecasting a jump in profits from £2.7m to £5.9m on sales of £22.9m, giving earnings of 8.9p and a forward p/e of 15.8. That’s undemanding for the sector. Strong buy.
| Market cap: | £82m |
| PE Forecast: | 15.8 |
| Share price: | 140.5p |
| LSE | £39.53m |
64.00p
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