JTC Group (LON:JTC) has released a trading update for the year to 31 December 2018, which confirms that:
“JTC has maintained good momentum through the second half of the year and continues to deliver on the strategic and financial initiatives outlined at IPO. As a result, the Board continues to expect that full year results will be in line with management expectations.”
Nigel Le Quesne, Founder and Group CEO added:
Integration of both the Van Doorn and Minerva acquisitions has been as planned, including synergies and the transfer of new business pipeline and connected relationships, with positive feedback from clients and staff;
The Board is confident in JTC’s pipeline and new business wins across both divisions, incremental improvements in our global operating model and the continued opportunities for acquisitive growth;
JTC’s ‘Ownership for All’ programme, which supports JTC’s long and established record of shared ownership” has been updated.
Full year results are due to be released on Wednesday 3 April 2019.
Zeus view:
We are pleased to see that both divisions have delivered organic revenue and profit growth, and that the acquisitions are being integrated as planned.
We make no change to our forecasts, which are marginally below consensus:
Zeus revenue forecast of £76.5m is 1% below consensus of £77.4m;
Zeus adj EPS forecast of 16.7p is 1% below consensus of 16.9p.
Valuation:
JTC at 363p a share, is trading on a current year PER of 21.7x, based on what we believe to be prudent forecasts.
On a proforma basis, including a full year contribution from both the Minerva and Van Doorn deals, we would expect JTC’s 2018 proforma PER to be circa 19.6x (see Exhibit 3) with prospects of 18% growth.
