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29 Jan 2021 | 09:48

Next Fifteen trading above expectations in fourth quarter

(Sharecast News) - Next Fifteen Communications said on Friday that trading in the final quarter of its financial year had been strong, and ahead of management expectations. The AIM-traded firm said that, for the three-month period ending 31 January, revenues were expected to be up by about 9% over the prior year, with a return to modest organic revenue growth.

It said its operating profit margin had also shown strong growth compared with last year.

As a result, the board said it expected that results for the year ending 31 January would be ahead of current market expectations.

"The performance has again been led by our B2B technology-focussed agencies, such as Activate, Twogether and Agent3, but we have also seen a strong recovery in performance from our B2C agencies, such as MBooth and Savanta," Next Fifteen said in its statement.

"Our revenues in the US and the UK have strengthened as our financial year has progressed, resulting in an anticipated organic revenue decline of approximately 1.5% for the group in the second half of our financial year, demonstrating a resilient performance in the second half and which compares with a 6.6% decline experienced in the first half."

Next Fifteen said that, while the Covid-19 pandemic had continued to impact the global economy, it remained "cautiously optimistic" about trading as it entered the new financial year.

"The strength of our customer base, coupled with the increasingly digital and data-driven nature of our product offering, continue to position us well to capitalise on opportunities as the economy continues to adapt to and ultimately emerge from the pandemic.

"Unsurprisingly therefore, new business activity has remained strong and we have won a number of significant new clients including Hitachi, TDK, DoorDash, and Goodyear."

The company said it was "highly" cash-generative, and had a strong balance sheet with net cash on 25 January of around £10m after the early repayment of VAT deferred from earlier in the year.

"We anticipate resuming the payment of dividends following our annual general meeting in June."

At 0929 GMT, shares in Next Fifteen Communications Group were up 4% at 624p.
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