Future (FUTR) stock soars after it more than doubles profits
By Rob Griffin
09:36, 30 November 2021
Shares in UK media group Future soared on Tuesday morning after it revealed full-year pre-tax profits had more than doubled to £107.8m ($144m).
The publisher of magazines such as Marie Claire and Golf Monthly also saw its revenue hit £606.8m in the 12 months to 30 September 2021, up 79% on the previous year.
The strong performance means the company has now upgraded its outlook and believes adjusted results for full-year 2022 will be “materially above current expectations”.
Dividend increase
In a statement, Future said it was proposing a dividend of 2.8p per share for the year – 75% up on the 1.6p in 2020 – which reflected the “growth of the group” and confidence in the future.
It also highlighted “strong organic growth” alongside the acquisitions of CinemaBlend, Mozo, GoCo and Marie Claire US, as well as the recently completed purchase of publishing company Dennis.
The news went down well in the markets, with the stock rising almost 16% to £36.92 during early trading in London.
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Exceptional results
Chief executive Zillah Byng-Thorne said the “exceptional results” reflected the company’s global reach and the diversity of its revenue streams.
“We generated 23% organic growth in the period, driven by the strength of our trusted content which continues to attract a high-value audience,” she said.
Byng-Thorne expects Future’s diversified strategy to continue to deliver and believes it’s well-positioned to continue to grow strongly.
“We are upgrading our outlook for the full year and now expect adjusted results in full-year 2022 to be materially above current expectations,” she added.
Buy recommendation
Roddy Davidson, research analyst at Shore Capital, believes Future’s current stock valuation is modest.
“We are very pleased to note the strong financial and operational performance and continuing momentum detailed in this release,” he said.
Davidson expects very attractive medium-term earnings per share and dividend per share progression as Future drives ecommerce and digital advertising revenue growth.
“We also see attractive potential in overseas markets (spearheaded by the US) and expect organic progress to be complemented by further earnings enhancing acquisitions,” he said.
Digital advertising growth
According to Future’s statement, digital advertising revenue performed strongly and was up 27% organically.
“Our endemic brands and global scale coupled with our proprietary high-intent data has enabled us to leverage the knowledge of our audience’s interests, preferences and intent to deliver a strong fundamental offering for advertisers,” the company stated.
The organic revenue growth of 4% in magazines was driven by a strong recovery in the second half of 34% against comparators, which were impacted by store closures reducing newsstand sales.
Read more: Future to acquire Dennis media in £300m deal
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