Earnings Update for Two FTSE Stocks: Hill & Smith Holdings PLC and Robert Walters PLC

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Earnings Update for Two FTSE Stocks: Hill & Smith Holdings PLC and Robert Walters PLC

 Earnings Update for Two FTSE Stocks: Hill & Smith Holdings PLC and Robert Walters PLC

The global outbreak of the Coronavirus (COVID-19) is aggravating every day, the disease has been transitioned itself form epidemic to pandemic and at this stage it is difficult to speculate on the duration and its future impact on the company’s performance. The material impact on the businesses due to the Coronavirus can only be ascertained after some time.

Here, we are going to discuss the latest result announcements of two diverse sector stocks, which are quoted on the London Stock Exchange (LSE). The stocks include Hill & Smith Holdings PLC from the Industrial Engineering Sector and Robert Walters Group from the Support Services sector.

Hill & Smith Holdings PLC released audited results for the year ended 31 December 2019

The company’s Annual revenue surged by 8 per cent at constant currency basis to £694.7 million in the fiscal year 2019 as against £637.9 million in the fiscal year 2018. The company’s Underlying operating profit increased by 6 per cent at the constant currency basis to £86.3 million, which included a currency translation benefit of £1.4 million in the fiscal year 2019 as against £80.1 million in the fiscal year 2018. From acquisitions/disposals, the net underlying operating profit contribution was £4.8 million in the fiscal year 2019.

The company’s Underlying operating margin dipped by 20 basis points at constant currency basis to 12.4 per cent in the fiscal year 2019 as against 12.6 per cent in the fiscal year 2018. The company’s underlying profit before taxation surged by 4 per cent to £79.4 million in the fiscal year 2019 as against £76.3 million in the fiscal year 2018. The company’s Reported operating profit surged by 6 per cent to £69.2 million in the fiscal year 2019 as against £65.2 million in the fiscal year 2018. The company’s Reported profit before taxation increased to £61.8 million in the fiscal year 2019 from £59.8 million in the fiscal year 2018.

(Source: Company’s filings, London Stock Exchange)

The 83 per cent of the total revenue and 96 per cent of the underlying operating profit of the company was contributed from the Group's UK and US operations. Due to strong year-on-year growth in the US businesses driven by investment in both ageing infrastructure and the construction of new infrastructure projects, revenues in these two core geographies grew by 2 per cent on organic basis with underlying operating profit growing by 9 per cent on organic basis. The company’s net debt was recorded at £215.3 million at 31st December 2019. The company has proposed an increment of 6 per cent in the final dividend, making it to 23 pence per share for the fiscal year 2019 in contrast to 21.8 pence per share in the fiscal year 2018. The annual dividend of the company surged by 6 per cent to 33.6 pence per share in the fiscal year 2019 as against 31.8 pence per share in the fiscal year 2018.

Business overview: Hill & Smith Holdings PLCÂ

Hill & Smith Holdings PLC (LON: HILS) is the United Kingdom-based industrial engineering company. The group is involved in the supply and manufacturing of infrastructure products and galvanising services. The operations of the group are differentiated in three operating divisions: Infrastructure Products -Roads, Infrastructure Products -Utilities, and Galvanizing Services.

Hill & Smith Holdings PLCÂ -Stock price performance

Daily Chart as at Mar-05-20, before the market close (Source: Thomson Reuters)

On 05th March 2020, at the time of writing (before market close, GMT 09:12 AM), Hill & Smith Holdings PLC’s shares were trading at GBX 1,437, down by 0.21 per cent against its previous day closing price. Stock's 52 weeks High and Low is GBX 1,534.00/GBX 1,049.00. At the time of writing, the share was trading 6.32% lower than its 52w High and 36.99% higher than its 52w low. The company’s stock beta was 0.50, reflecting lesser volatility as compared to the benchmark index. The outstanding market capitalisation was around £1.14 billion along with an annual dividend yield of 2.33%.

Robert Walters Plc Results for The Year Ended 31 December 2019

Despite global turbulence, the company delivered resilient performance, however, the outlook remains uncertain. The company’s Revenue was down by 2 per cent on constant currency basis to £1.22 billion in the fiscal year 2019 as compared to £1.23 billion in the fiscal year 2018. The company’s net fee income was up by 2 per cent on constant currency basis to £405.5 million in the fiscal year 2019 as compared to £392 million in the fiscal year 2018. The company’s UK net fee income was down by 9 per cent to £98.4 million in the fiscal year 2019 as against £107.4 million in the fiscal year 2018.

The company’s Operating profit was up 1 per cent on constant currency basis to £51.2 million in the fiscal year 2019 as compared to £49.7 million in the fiscal year 2018. The company’s adjusted earnings per share increased by 0.4 per cent to 50.6 pence in the fiscal year 2019 as against 50.4 pence per share in the fiscal year 2018. The company’s statutory reported operating profit was up by 1 per cent to £51.2 million in the fiscal year 2019.  The company has a strong balance sheet with cash balances of £85.8 million as at 31 December 2019. The Board has proposed a 3 per cent rise in the final dividend to 11 pence per share during the period. The total dividend increased by 5 per cent to 15.5 pence per share in 2019 as against 14.7 pence in 2018.

(Source: Company’s filings, London Stock Exchange)

Business overview:Â Robert Walters PLC

Market-leading international specialist professional recruitment organisation Robert Walters Group PLC (LON: RWA) has more than four thousand representatives with presence across 30 plus nations. The company provides placement assistance to well qualified professionals in various specialised domains such as banking & finance, engineering, accountancy, human resources, information technology, sales & marketing, legal consulting, logistics & supply chain. The company has a diverse client base which includes, blue-chip companies, financial services companies and other corporate houses.Â

Robert Walters Group PLC -Stock price performance

Daily Chart as at Mar-05-20, before the market close (Source: Thomson Reuters)

On 05th March 2020, at the time of writing (before market close, GMT 11:27 AM), Robert Walters Group’s shares were trading at GBX 485, down by 3 per cent against its previous day closing price. Stock's 52 weeks High and Low is GBX 676.00 /GBX 428.20. At the time of writing, the share was trading 28.25% lower than its 52w High and 13.26% higher than its 52w low. The company’s stock beta was 0.45, reflecting lesser volatility as compared to the benchmark index. The outstanding market capitalisation was around £378.52 million along with an annual dividend yield of 3.10%.

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