10/01/2006
ILX, the vocational education and training business we backed as a strong buy at 117p last November, has pleased with a bullish quarterly trading update. Trading in the third quarter remained upbeat, November acquisition Mount Lane is integrating nicely, and ILX expects to hit upgraded forecasts for the year to the end of March.
Chief executive Ken Scott flagged up stellar recent sales of training products and services across the group to hundreds of clients – the Home Office, Hilton Hotels, the MOD and Siemens among them – and said ILX’s Computa-friendly unit had just clinched a £126,000 deal from the Wiltshire Constabulary to train for a new police records management system. Mount Lane, a fast-growing provider of specialist training services that helps large organisations during their IT platform migrations, has signed a £60,000 deal to implement a desktop migration project with Scottish Courage, a new client for the group.
The final quarter to March is traditionally ILX’s strongest – the company has a heavy seasonal bias towards the second half – and Scott remains more than confident the year’s figures won’t disappoint. For the full year, investors can expect pre-tax profits of £980,000 from sales of £7m, giving earnings of 9.45p and a prospective p/e of only 11.5.
Based on that multiple, levels of organic growth, the benefits of the Mount Lane deal, the likelihood of other value-adding deals, and the enthusiastic stewardship of Scott, the shares remain excellent value. Strong buy.
| Market cap: | £12.8m |
| PE Forecast: | 11.5 |
| Share price: | 108.5p |
| AIM | £4.46m |
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| Other company articles: |
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