Medserv PLC (MT:MDS) has demonstrated the success of its broadened geographic reach with strong H118 revenue growth and improved profitability. With the required investment in equipment and personnel complete, we see greater momentum and improved profitability in H218. We maintain our forecasts.
H118
Medserv reported group revenues of €18.14m (H117: €13.62m), up 33.2% on the stronger contribution from operations in Malta and Cyprus in its Integrated Logistics Support Services (ILSS) operations. Group EBITDA of €3.40m (H117: €2.87m) represented an 18.5% uplift. The company invested €5.42m in equipment, mainly related to the start-up operation in Egypt. With this in place, H218 performance will reflect increased income from this project. Performance in Oil Country Tubular Goods (OCTG) was held back by weakness in Oman, but this is expected to improve in H218. Group H118 loss per share of 4.5c (H117: 6.8c loss) improved by 33.8% and should see a stronger H218 result with the improved profit contribution expected from both divisions. Net debt increased to €53.0m (FY17: €49.2m). The company has maintained FY18 guidance and we have maintained our forecasts.
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