Marketing consultancy group Porta Communications PLC (LON:PTCM) has reported robust trading for the year putting the group firmly in the black for the first time in its history, staving off impending Brexit uncertainty.
With the looming EU referendum, the group saw some temporary slowdown in project work in the UK. "The city is a lot quieter," said chief executive David Wright, "If we didn’t have to contend with it we’d have done a lot lot better."
But the board remained confident that it had created a sturdy platform across strongly performing markets, and that organic fee income would remain robust.
Lifting it out of its cash-burning start-up phase, the group saw significant improvement in operating cash inflow at £1.3mln, compared to outflow of £3.4mln the previous year. Gross profit was up 39% to £26.9mln, while adjusted earnings (EBITDA) were up 447% on the previous year to £1.1mln (£196k in 2014).
“I am pleased to report that 2015 was a hugely productive and progressive year for the Porta Group. Our financial results for the year clearly demonstrate the further progress that has been achieved,” said chairman Bob Morton.
“There is clear evidence that Porta can continue to sustain high levels of organic growth and maintain its positive cash performance,” said Morton.
In 2015, the client base grew by 231 to 836 thanks to the group’s “buy, build and grow” strategy.
In the period, the group integrated three acquisitions, Redleaf Communications, Puclicasity and PPS Group, which were all "performing well and cash generative".
“In just over four years we have built a very exciting integrated business platform that will fuel continued growth in the group. Our reputation is growing in the market place to the extent that we are attracting some of the best talent in our industry which augurs well for the future,” said Wright.
Wright told Proactive that the group was looking to hire some "heavyweight executives going forward," which he hoped would support growth.
"I don’t know of anything comparable to what we’ve got and that’s what’s attracting these top people, and that is going to have a big impact on numbers going forward."
Wright said that the group was looking to double the size of the group's Australian business after another "sensational year" with high margins offsetting poor currency conditions. The group is now the market leader in Australia, claimed Wright. Porta is looking to launch at least one new company to sustain the anticipated growth.
Trading for the first quarter of 2016 was already ahead of budget and the group expects to outperform the sector.
"Our ultimate goal is to generate a lot more cash and start paying off debt as soon as possible," Wright added.
Shares were down 4.5% to 5.85p.
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