Mortgage Advice Bureau Update confirms good growth

Growth in a relatively flat market

This morning’s pre-close trading update confirms that Mortgage Advice Bureau (Holdings) Plc (LON:MAB1) has achieved good growth in 2017 and that 2018 has started well. Specifically:

14% yoy rise in average adviser numbers to 1,008 (31 Dec 17: 1,078);

17% rise in revenue to £109m (1H17: £50m; 2H17E: £59m);

3% increase in average revenue per adviser (i.e. productivity)

Group PBT for the year 2017 is “in line with the Board’s expectations”

Cash over £22m (including over £13m of unrestricted balances)

The number of Appointed Representatives (ARs) which use MAB continues to grow. Peter Brodnicki, CEO comments “[MAB has] a strong pipeline of new ARs and we remain confident about delivering our growth plans, both organically and from new ARs.”. Full year results are due on Tuesday 20 March 2018.

Zeus view

This trading update confirms MAB is delivering double-digit revenue, profit and dividend growth through growing adviser numbers and benefits of scale.

Unrestricted cash balances have risen by more than £2.1m (June 2017: £10.9m): this is encouraging. We leave our PBT, EPS and DPS forecasts for 2017 and 2018 unchanged (page 2).

For 2017 we expect:

16% yoy growth in gross profit to £25.7m (1H17: £12m; 2H17E: £14m);

Gross profit margin of 23.7% (1H17: 24.1%; 2H17E 23.3%);

13% yoy growth in PBT to £14.2m (1H17: £6m; 2H17E: £8m);

13% rise in EPS to 22.9p (1H17: 10.4p; 2H17:12.5p);

15% rise in the total DPS to 21.0p (interim DPS of 9.5p; final DPS: 11.5p)

For 2018 we expect EPS to rise 21% to 27.8p (consensus: 26.5p).

Valuation

At 626p Mortgage Advice Bureau (Holdings) Plc shares are trading on 23x current year 2018 earnings and, with prospects of 16% growth in 2019, a Price-Earnings-Growth ratio of 1.4x. This valuation reflects the quality of MAB’s cashflow, earnings and dividend stream.

Click to view all articles for the EPIC:
Or click to view the full company profile:
    Facebook
    Twitter
    LinkedIn
    Mortgage Advice Bureau (Holdings) Plc

    More articles like this

    Mortgage Advice Bureau (Holdings) Plc

    Is the prospect of longer tenancies good or bad news?

    In early July, the Government opened a consultation into the benefits and barriers to landlords offering longer tenancies. This is the latest step in its commitment to increase security of tenure for tenants in the PRS,

    Mortgage Advice Bureau (Holdings) Plc

    A helpful guide for first time buyers

    Buying your first home can be quite daunting. It’s likely to be the biggest financial commitment you’ll ever have, so you need to know that you’re making the right decision. Searching for a mortgage can be

    Mortgage Advice Bureau (Holdings) Plc

    What does the interest rate rise mean for me?

    The Bank of England has raised its bank rate today to 0.75 per cent and we’re here to cut through the jargon and answer, what does this mean for you and your mortgage? I’m on a

    Mortgage Advice Bureau (Holdings) Plc

    National Mortgage Index July 2018

    Mortgage Advice Bureau (LON:MAB1), Brian Murphy, Head of Lending comments: “June appeared to be consistently busy in many regions, with members of the network observing a solid number of buyer enquiries, regardless of the distractions of

    Mortgage Advice Bureau (Holdings) Plc

    August Interest Rate Decision

    Today, the Bank of England announced the bank rate would be increasing to 0.75 per cent, which could have an impact on those who are on SVR mortgages. Mortgage Advice Bureau Plc (LON:MAB1), Brian Murphy, Head of

    Mortgage Advice Bureau (Holdings) Plc

    Mortgage Advice Bureau plc another strong performance

    Peter Brodnicki, CEO of Mortgage Advice Bureau (Holdings) plc, said: “I am delighted to report another strong performance in the first half of 2018. Housing transactions have reduced slightly compared to the equivalent period last year,

    Mortgage Advice Bureau (Holdings) Plc

    MAB launches wealth and equity release proposition with Tenet

    Mortgage Advice Bureau has launched a wealth and equity release proposition in partnership with Tenet. The proposition will initially comprise 14 wealth advisers but MAB says it has “ambitious expansion plans”. Tenet is also dual authorising

    Mortgage Advice Bureau (Holdings) Plc

    Rightmove House Price Index July 2018

    Mortgage Advice Bureau (LON:MAB1) Brian Murphy Head of Lending comments: “The monthly Rightmove House Price Index provides us with an up to date ‘litmus test’ of consumer sentiment and activity in terms of the UK property

    Mortgage Advice Bureau (Holdings) Plc

    Buyers back in the market in May

    Mortgage Advice Bureau (LON:MAB1), Brian Murphy, Head of Lending comments: “May appeared to be one of the best months so far this year for some regions, with members of the network reporting a marked increase in

    Mortgage Advice Bureau (Holdings) Plc

    Halifax Price Index June 2018

    Brian Murphy, Head of Lending for Mortgage Advice Bureau comments: “The report released by the Halifax this morning indicates that house price growth appears to have steadied in May, following a somewhat lacklustre set of figures