31 October 2014

Hyder Consulting

BUY

09/06/2003 Leslie Copeland

International consulting engineer Hyder Consulting has announced strong maiden results, its first set after re-listing via a reversal into cash shell Firth Holdings last October. The numbers for the year to March were ahead of expectations, with pre-tax profits reaching £2.2m (£94,000) on turnover of £50.5m (£158,000). Chief executive Tim Wade said if Hyder had been consolidated for the full twelve months, sales would have been £115.2m. The engineering design, advisory and specialist management consultancy has a healthy order book of £158m, is improving its margins and has contained losses in Asia Pacific - and public investment in infrastructure across its main markets has vindicated the focus on public sector work. The UK business performed strongly, benefiting from the working through of low-margin projects and Highways Agency framework contracts showing through. In the water market, Hyder enjoyed regular work with a wide range of UK water companies. Elsewhere, the Middle East performed 'exceptionally well', Australia should turn profits 'in the near term', but Hong Kong is the 'main challenge' in Asia Pacific. At the year end, net assets were £14.7m (64p a share) and net debt £3.2m. There's no dividend for the year, but the board plans to pay out next time around. House broker Evolution Beeson Gregory predicts £2.2m pre-tax and earnings of 6p for the current year. Buy.

Sector: General Industrials

Companies: Hyder Consulting

Market cap: £68m

PE Forecast: 13.25

Share price: 83.5p

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