23/02/2006
Information management and translation services business SDL continues to make strong progress. Full year results for the year to 31 December saw sales rise 25% to £78.5m as profits before tax increased 18% to £5.2m. Moreover, chief executive Mark Lancaster notes that the £35m acquisition of TRADOS in July has been integrated ahead of schedule and contributed £500,000 of profit during the period.
To Lancaster, this deal transforms the business. Traditionally SDL has focused on enabling customers (large and small organisations alike) to translate and amend content, ensuring its relevance in different countries and cultures. TRADOS, by way of contrast, specialises in the more general field of global information management and this, Lancaster argues, allows SDL to evolve from niche player to mainstream software and services provider.
Having secured a multitude of big-name customers in 2005 – Chrysler, France Telecom and Honda included – investment in sales and marketing will continue this year and market expectations are now for a profit of £9.4m in 2006 on sales of £92.5m. Forecast earnings of 10.3p place the shares on a prospective p/e of 21.4. This may seem rather steep, especially since the shares have risen by more than 50% in 12 months, but with businesses of all sizes increasingly having to address overseas markets, the trends continue to move in SDL’s favour. The shares remain worth holding for the long-term.
| Market cap: | £135.5m |
| PE Forecast: | 21.4 |
| Share price: | 220p |
| LSE | £157.34m |
207.75p
|
7.50p
|
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| Other company articles: |
| 05/08/2008 |
| 02/06/2008 |
| 08/02/2008 |
| 23/02/2006 |
| 15/09/2005 |
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