Building on its market leading position in the UK and Europe, internet domain name specialist Group NBT has bolstered its sales teams domestically, in Europe and the US to generate ever more organic growth. An acquisition is definitely on the cards too, with domain name management in Europe the focus. At the end of December it had a warchest of £4.3m for this purpose.

In the six months to end-December the flagship NetNames Platinum domain name management business swelled revenues 43% to £2.1m, and now has  £4.1m revenue recurring on an annualised basis. The potential for growth is strong here, says chief executive Geoff Wicks, as most companies do not have a managed domain name service and are increasingly learning that they should.

Other parts of the group include NetBenefit managed hosting, growing at over 20%, and the Easily online services brand, growing at less than 5%. Although not expected to grow much faster, the latter division provided well over half of group revenue and ‘is a hunting ground for customers’ for the other two arms. A boost will come this year as existing and new customers rush to register website addresses for the newly introduced ‘.eu’ suffix.

Interim revenues and pre-tax profits came in ahead of expectations at £6.2m (£5.4m last time) and £970,000 (£670,000). A maiden dividend of 0.4 ‘reflects the confidence’ of the management.

Company broker Bell Lawrie has tweaked profits forecasts upwards to £2.6m for the full year 2006 and £3m for 2007, generating earnings per share figures of 9.2 and 10.8, lower than last year’s 10.9 because tax will now be charged on profits. Ensuing forward p/e ratios of 14.5 and 12.4 are not overly demanding. Keep holding.

Group NBT	AIM	£60.6m	241.00p	0.00p
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