UK share prices continue to struggle for grip in Tuesday trading. Both the FTSE 100 and FTSE 250 are basically flat from the prior close as lingering fears over rising inflationary pressure and setbacks in the fight against Covid-19 hang in the air. But the DWF Group (LSE: DWF) share price is having no problems gaining traction in today’s session.
Prices of the legal services provider have broken back through the critical 100p per share market today. At 100.5p the DWF share price is now up 5% on the day. It’s also 30% higher than it was a year ago and currently trading at its most expensive since March 2020.
DWF Group beats forecasts
DWF has sprung higher thanks to a positive reception to a full-year trading statement.
The business — which provides integrated legal and business services across a range of industries — said that revenues soared 13% during the 12 months to April, to £338m. On an organic basis, group turnover rose by a solid 8% too.
On top of this, both sales and gross profit margins had improved in every division, while the company’s cost-to-income ratio had reduced.
As a consequence adjusted pre-tax profit blasted past expectations for fiscal 2021. This clocked in at £34m, up more than 120% year-on-year. This also surpassed market forecasts by a healthy 15%.
Finally, net debt at DWF dropped to £61m as of April, down £4m from the same point in 2020. This was despite the impact of deferred consideration and acquisition-related payments of £17m in the period.
Sales keep rising!
Today’s full-year update suggests that the group has got the new financial year off to a strong start too. It said that it “has continued to enjoy strong activity levels” and noted that its pipeline remains “robust.”
Commenting on today’s results, DWF chief executive Sir Nigel Knowles said that they “show significant improvement on the prior year and a strong performance in their own right.” He added that “we have grown the business, transformed our profitability, improved our operational efficiency and strengthened our balance sheet notwithstanding the impact of Covid-19 during the year.”
More acquisitions made
A strong set of financials isn’t the only reason why DWF has commanded plenty of attention today. On Tuesday, the legal giant also announced the acquisition of two new businesses at home and abroad.
DWF has snapped up compliance training specialist Zing 365 Holdings. It has also reached an agreement to buy BCA Claims & Consulting Limited (which trades as Barnescraig & Associates), a Canadian insurance claims and loss-adjusting business. Completion of the deal is expected by the end of this week.
“These acquisitions together are expected to add circa £3m of revenue and circa £0.5m of adjusted profit before tax in financial 2022,” DWF said. It added that the acquisitions “are expected to be immediately earnings enhancing.”