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Begbies Traynor Q3 trading in line, buys Springboard Corporate Finance
AIM-listed Begbies Traynor said on Tuesday that third-quarter trading was in line its expectations, as it announced the acquisition of Springboard Corporate Finance.
In an update for the quarter to the end of January 2018, the company said revenue and profit were up in the year-to-date, reflecting improved year-on-year performance in business recovery and advisory services.
It said the year-on-year increase in corporate insolvency appointments experienced in the first quarter of calendar year 2017 and reported in the July year-end announcement, was sustained for the calendar year as a whole. The total number of corporate insolvencies in 2017 was up 9% to 16,112 following the 2015 and 2016 calendar years, which represented the lowest level of corporate appointments since 2004.
Executive chairman Ric Traynor said: "A good performance in the first nine months of our financial year bodes well for a positive full year outcome, and is expected to ensure the group continues its recent track record of profit and earnings growth.
"Our strengthened financial performance is enabling us to execute our strategy and continue to invest in the growth of the business as demonstrated by our two recently completed acquisitions."
The company announced in a separate statement that it has acquired mid-market corporate finance practice Springboard, which has offices in Birmingham, London and Nottingham, for an initial net consideration of £2.75m. This will be satisfied in cash from existing resources and through the issue of 1.88m new ordinary shares.
There will also be an additional contingent consideration of up to £0.5m, payable subject to the achievement of financial targets in the five-year period directly following completion.
Begbies said the acquisition is in line with its strategy to develop its advisory services and provides "an excellent platform" for organic and acquisitive growth when combined with the group's existing advisory teams in London and Manchester.
In its financial year ended 30 June 2017, Springboard generated revenue of £2.3m and pre-tax profits of £0.75m.
At 1025 GMT, the shares were up 2.5% to 74.70p.