This group proudly proclaims that it is a creative solutions company, like no other.
And that is certainly true – its talents are globally recognised.
However, I still feel very sorry for Vin Murria, the software and computer entrepreneur who had founded then developed and sold off various interests.
In 2021 she gradually accumulated a meaningful shareholding in the group and was appointed a Director.
In January 2022, she suggested that together with AdvancedAdvT, of which she was the Executive Chairperson, they might make an offer for Saatchi.
The long and short of the saga resulted in a stout defence by Saatchi, based upon substantial business projections.
The Murria effort proved fruitless.
Subsequently, there have been a lot of changes within the marketing group’s corporate framework.
I alighted upon the group at 64p in May 2020 and supported, in print, Murria’s attempt at looking to shake up the company.
Its shares peaked at 227p in May 2022, since when they fell to 118.5p by August 2023.
Over the last year or so, there has been a gradual recovery in the group’s share price, topping out at 220p last month.
Tomorrow, the group will be announcing its Interim Results for the six months to end-June.
It is hoped that the first half of the year will have seen a continuation of the strong trading momentum of late 2023.
It might also reflect the better performances of the reorganised group.
Analysts Caspar Erskine and Andrew Ripper at Panmure Liberum rate the group’s shares as a Buy, looking for 265p as their Price Objective.
For the full year to end-December they look for revenues of £250m (£253m) with pre-tax profits increasing to £34.4m (£28.7m), generating 18.3p (14.4p) per share in earnings, while paying out a paltry 2.0p (1.6p) dividend.
Their estimates for 2025 suggest £260m sales, £41.9m profits, 22.0p earnings and a 2.5p per share dividend.
It will be very interesting to see exactly how the analysts shape their estimates after tomorrow morning’s announcement.
The group’s shares are currently trading at around the 197p level, valuing the group at £238m.
Holders should be patient as they await the promised recovery.
(Profile 11.05.20 @ 64p did not set a Target Price)
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