RDF Media’s fortunes have faltered since the BBC’s and ITV’s suspension of business with the TV production group, following last year’s controversy surrounding the editing of a clip of the Queen, which forced the resignation of chief creative director Stephen Lambert.
Results for the year to January, reflecting a turbulent year, revealed a reduction in pre-tax profits to £2m (2007: £6.2m), resulting in a dividend cut to 0.5p (2007: 3p). Planned investments that ‘ran ahead of lower than anticipated revenues’ in the UK production division resulted in a £5.8m increase in overheads to £26m and a sharp rise in year-end debt to £13.7m (2007: £0.2m).
However, the diversified group still achieved 21.5% growth in revenues to £120.6m, with the US division performing strongly, as did the intellectual property division, whose turnover grew by 147% to £9.2m.
While the company will not comment on talks regarding a cash offer to take the company private (by chief executive David Frank and largest shareholder John de Mol, of Endemol fame), broker Altium believes a formal bid will emerge.
Setting a 150p price target for RDF, Altium forecasts growth in revenues for 2009 to £128m, although earnings should reduce to 10.5p (2007: 14.8p) due to an increase in the number of shares in issue following the exercising of options. Based on those estimates, RDF trades on a forward multiple of just 12.1 and should offer a degree of bid excitement. Speculative buy.
Growth Company Investor subscribers have full access to all our AIM and small-cap share recommendations. To subscribe today with a half-price offer, and gain immediate access to all the recommendations, click here.
Market cap: £53.27m
PE Forecast: 12.1
Share price: 127.5p
£7,277 That’s what you would have in your portfolio if you had invested £6,000 into the six Company Watch recommendations in our April 2009 issue.
Advertisement
Growth Company Investor, in association with the London Stock Exchange, presents the most wide-ranging and detailed examination of the AIM market: AIM in Review 2010. For more information and to order, click here or contact our marketing team on 020 7250 7056.
M&A on AIM 2009 is a unique and wide-ranging examination of merger and acquisition activity on AIM over the past 12 months, with an analysis of all the acquisitions, disposals, takeovers and delistings on AIM, including
canvassing the opinions of some of the major M&A powerbrokers. To order click here.
Free access to the latest AIM stock recommendations and news from the award-winning Growth Company Investor team. Receive our tips on what stocks to buy direct to your inbox every Tuesday and Friday. Find out more today.
Cautious? Positive? Adventurous? Choose between three levels of risk for a fund of funds from Sharefunds, our sister company. Click here for more information.
The brand new, fully updated AIM Guide 2009/2010 is now available to purchase. AIM Guide is the only fully comprehensive guide to AIM and is regarded as 'must-have' for any serious investor or professional interested in the market for young, fast-growing companies. Order your copy today and benefit from a £10 discount!
This report's principal aim is to provide business owners seeking funding with information about the amount of funds that VCTs have to invest. Click here for more information.
Business XL, the award-winning monthly magazine for growing companies, is delighted to announce the launch of a new study on cash shells. The research provides a comprehensive overview of cash shells on AIM, companies that have become a significant feature on the AIM landscape. Buy the Cash Shells 2009 Research Report today or email Halid Delkic to obtain a free two-page abstract.
Small-cap and growth company share recommendations on AIM- and PLUS-listed companies. Latest analysts' stock tips and advice on which are the best shares to buy on London's junior stock markets.
Advertisement
Organic composting specialist TEG is pursuing long-term contracts after turning £1.6m of annual losses into £155,000 pre-tax profits in calendar 2009.
European Goldfields hopes to move from AIM to the Full List by the end of 2010 after securing a key permit in Romania.
Revenue visibility at StatPro, the Wimbledon-based provider of analytics and data to asset managers across Europe, South Africa and North America, continues to improve.