Stocks Going Ex-Dividend Today – NMC, PSN, WPP and SVT

NMC Health Plc

NMC Health PLC (NMC) is an Abu Dhabi based diversified health care group with operations across several countries. The group owns and manages over 200 healthcare facilities and is the largest private healthcare company in the United Arab Emirates. The group’s business is differentiated in two reportable segments: healthcare and distribution & services. The Chief Executive Officer of the group is Prasanth Manghat.

Financial Highlights (FY 2018, $m)

(Source: Company Filings)

The group's revenues grew by 28.3% to $2,057.3 million, driven by the healthcare division, which grew by 34.4%. Organic revenue growth at 15.4% was ahead of guidance. EBITDA grew by 37.9% to $487.4 million, leading to an improvement in an EBITDA margin of 170bps, led by healthcare division, which increased by 37.3%. Net profit was reported at $251.9 million, an increase of 20.4%, reaching the highest level in the group's history. The basic EPS for the FY 2018 stood at $1.196 against $0.910 in FY 2017, while adjusted EPS surged by 28.5% to $1.332 in FY 2018 as compared to $1.036 in FY 2017.

Dividend

The company announced a final dividend of 18.1 pence per share, representing an increase of 39% over the last year, and keeping in line with its policy of paying a dividend of approximately 20% of profit after tax. The Ex-dividend date is 13 June 2019, while the dividend will be paid on 10 July 2019.

Share Price Commentary

Daily Chart as at June-13-19, before the market closed (Source: Thomson Reuters)

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On 13^th June 2019, at the time of writing (before the market closed, GMT 12:12 pm), NMC shares were trading at GBX 2,369, up by 1.8 per cent against the previous day closing price. Stock's 52 weeks High and Low is GBX 4,376.00/GBX 2,110.00. The company’s stock beta was 0.83, reflecting less volatility as compared to the benchmark index. Total outstanding market capitalisation was £4.87 billion with a dividend yield of 0.78 per cent.

Persimmon Plc

Persimmon PLC (PSN) is a York, United Kingdom-headquartered holding company. It is one of the leading UK housebuilders and trades under the brand names, including Persimmon Homes. The company designs, develops and builds residential houses, ranging from studio apartments to executive-style family homes, offering a wide range of homes across 400 locations, and also operates its offsite manufacturing capabilities. The company is listed on the London Stock Exchange and is a part of FTSE 100. The Group Chief Executive is Dave Jenkinson.

Recent Developments

On 26th February 2019, the group named Dave Jenkinson as the Chief Executive of the group. He was appointed interim CEO in November 2018, following the public and political criticism company’s former boss Jeff Fairburn received after he refused to discuss the bonus awarded to him in 2017.

Trading Update

In the latest trading update, which covered the period from 1 January 2019 to 1 May 2019, the company reported that high levels of employment and low interest rates helped the new build housing market. With forward sales revenue of £2,698 million, a strong current forward sales position was reported, while firm pricing conditions was reaffirmed by a strong average selling price of sales of approximately £237,850.

Key Financial Highlights (FY 2018, in £m)

(Source: Company Filings)

Total group revenue for the year increased by 4% to £3.74 billion, driven by an increase in legal completions which grew by 406 new homes in 2018 to 16,449, against 16,043 in 2017. Average selling price rose by 1% year on year to £215,563, vs £213,321 in 2017. A 200bps increase in new housing gross margin to 33.3% was reported in 2018. Group’s underlying operating profit increased to £1.091 billion, representing an increase of 13%, while underlying new housing operating margin increased to 30.8%, reflecting a 260bps increase. Group’s reported profit before tax increased by 13% in 2018 to £1.091 billion from £0.966 billion in 2017, while basic earnings per share increased 11% to 283.3p. The company reported a 52.8% return on average capital employed, against 51.5% reported in 2017.

Dividend

In addition to the interim dividend of 125 pence per share, the company announced a final dividend of 110 pence per share. Shareholders on the register on 14 June 2019 will be paid the final dividend on 2 July 2019 with respect to the financial year ended 31 December 2018.

Share Price Commentary

Daily Chart as at June-13-19, before the market closed (Source: Thomson Reuters)

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On 13^th June 2019, at the time of writing (before the market closed, GMT 12:15 pm), PSN shares were trading at GBX 1,948, down by 4.83 per cent against the previous day closing price. Stock's 52 weeks High and Low is GBX 2,734.00/GBX 1,824.70. The company’s stock beta was 0.95, reflecting roughly the same volatility as compared to the benchmark index. Total outstanding market capitalisation was £6.54 billion with a dividend yield of 11.48 per cent.

WPP Plc

WPP PLC (WPP) is a London-headquartered holding company which comprises of subsidiaries in a range of disciplines and primarily engages in providing communications services. The group offers national and multinational clients a comprehensive range of communications services and is organised into four reportable segments: Public Relations & Public Affairs, Advertising and Media Investment Management, Data Investment Management, and Brand Consulting, Health & Wellness and Specialist Communications – which includes WPP Digital and direct, digital & interactive.

Trading Update (Q1 FY 2019)

The company anticipates a challenging year and certain significant client losses in 2018 impacted the first quarter. Revenue was £3.588 billion, up by 0.9% on a reported basis and down by 0.6% on a constant currency basis over the corresponding period last year. While revenue less pass-through costs was £2.926 billion, down by 0.7% on a reported basis, like-for-like revenue was -1.3% compared with last year.

Key Financial Highlights (FY 2018, in £m)

(Source: Company Filings)

The revenue for the full year declined by 1.3% on a reported basis to £15,602 million, against £15,804 million in FY 2017. However, on a like-for-like basis, revenue increased by 0.8%. The full year like-for-like revenue less pass-through costs were down by 0.4%, ahead of guidance, at £12,827 million. Operating profit decreased by 8.9% to £1,962 million, resulting in a decline in operating margin, which fell by 110 bps to 15.3%. The decline of 9.7% in profit before interest and tax, and the resulting drop in PBIT margin of 120bps, was due to restructuring and transformation costs and goodwill impairment. The diluted earnings per share declined by 10.3% to 108p from 120.4p in 2017, reflecting poor performance in headline numbers. Net debt position improved by £466 million at the end of FY 2018 to £4,966 million. However, the EBITDA fell over the year, leading to an increase in average net debt/EBITDA from 2.0x in FY 2017 to 2.1x in FY 2018.

Dividend

The company maintained the final dividend of 37.3p per share, despite a reduction in diluted earnings per share. The total dividend for the year was 60.0p per share for 2018, as an interim dividend of 22.7p per share was earlier announced. The dividend will be payable on 8 July 2019, with an ex-dividend date of 13 June 2019.

Share Price Commentary

Daily Chart as at June-13-19, before the market closed (Source: Thomson Reuters)

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On 13^th June 2019, at the time of writing (before the market closed, GMT 12:20 pm), WPP shares were trading at GBX 967.40, down by 3.4 per cent against the previous day closing price. Stock's 52 weeks High and Low is GBX 1,323.50/GBX 791.00. The company’s stock beta was 1.27, reflecting more volatility as compared to the benchmark index. Total outstanding market capitalisation was £12.67 billion with a dividend yield of 5.99 per cent.

Severn Trent

Severn Trent PLC (SVT) is a holding group which owns a portfolio of brands, including Severn Trent Water, which is amongst the 10 largest water and sewerage regulated companies in England and Wales. The subsidiary is focused on providing high-quality services to over 4.3 million customers both for business and households. Other brands include Hafren Dyfrdwy, Severn Trent Business Services - it provides businesses with tried and tested water services.

Key Financial Highlights (FY 2019, in £m)

(Source: Company Filings)

The company's reported turnover increased by 4.2% to £1,767.4 million, reflecting an increase in revenue from Regulated Water and Wastewater and Business Services segment for the current period. Due to lower interest rate and reduced RPI inflation on company's index-linked debt, reported profit before taxation rose by 6.8% to £384.7 million. The profit for the period from continuing operations increased by 32% to £315.3 million, while total profit for the year including discontinued operations was £315.3 million. Underlying basic earnings per share was 145.8 pence (2017/18: 120.5 pence), while Basic EPS from continuing operations increased by 31.0 % to 133.4 pence.

Dividend

The company declared a final ordinary dividend of 56.02p per share for 2018/19, reflecting an increase of 7.9% over the previous year, in line with its dividend policy for the remainder of AMP6 to increase the dividend by at least RPI+4% per annum. Along with the interim dividend, the total dividend for the year rose to 93.37p. The final ordinary dividend is payable on 19 July 2019, with the ex-dividend date of 13 June 2019.

Share Price Commentary

Daily Chart as at June-13-19, before the market closed (Source: Thomson Reuters)

 On 13^th June 2019, at the time of writing (before the market closed, GMT 12:25 pm), SVT shares were trading at GBX 2,050, down by 1.3 per cent against the previous day closing price. Stock's 52 weeks High and Low is GBX 2,100/GBX 1,757.01. The company’s stock beta was 0.81, reflecting less volatility as compared to the benchmark index. Total outstanding market capitalisation was £4.95 billion with a dividend yield of 4.50 per cent.