Better-than-expected trading results

In a trading update covering the six-months ended 31st March 2018, Sanderson Group announced revenue and operating profit figures that are ahead of management expectations, driven by good progress from both its digital retail and enterprise divisions. The software and IT services company added that it has a good level of confidence that it will make significant progress during the current financial year, which ends on 30th September 2018. Interim results will be released on 23rd May 2018. Accordingly, we maintain our forecasts for FY18 and FY19, and continue to classify the shares as a hybrid growth and income stock, with the shares offering investors exposure to the high-growth Enterprise Resource Planning software market as well as a decent prospective dividend yield of 3.4%.

In-line with expectation trading performance

At its annual general meeting (AGM), Sanderson Group updated on its trading performance for the first four months of the financial year ending 30th September 2018. Key highlights include an in-line with management expectation trading performance for the first four months of the current financial year and an expected continued progress for the remaining part of the year. Accordingly, we maintain our forecasts for FY18 and FY19, and continue to classify the shares as a hybrid growth and income stock, with the shares offering investors exposure to the high-growth Enterprise Resource Planning software market as well as a decent prospective dividend yield of 3.6%.

Full-Year Results Point to A Positive Outlook

Sanderson Group has announced its results for the 12 months ended 30th September 2017. Key highlights include revenue growth of 1.1%, adjusted operating profit growth of 5.7% and better than expected net cash of £6.18 million. The software and IT services business added that it is well positioned in its target markets, and that it has a good level of confidence that it will make further progress and deliver trading results that are, at least, in-line with market expectations for FY18. With the results in-line with our expectations, we maintain our forecasts for FY18. We also introduce forecasts for FY19, and continue to classify the shares as a hybrid growth and income stock, with the shares offering investors exposure to the high-growth Enterprise Resource Planning software market as well as a decent prospective dividend yield of 4.16%.

Strategic acquisition

In a move aimed at creating both revenue upside and cost saving synergies, Sanderson has acquired Anisa Consolidated Holdings, a holding company that specialises in the provision of information technology-based offerings across the entire supply chain management market, for a maximum value of £12.0 million. The acquisition was made at an attractive valuation of 5.8x adjusted EBITDA, and made with the objective of scaling-up Sanderson’s enterprise division. We update our forecasts for FY18, and we continue to classify the shares as a hybrid growth and income stock, with the shares offering investors exposure to the high-growth Enterprise Resource Planning software market and a decent prospective dividend yield of 4.1%.

Trading Update

Sanderson Group has announced a trading update for the 12-month period ended 30th Sept. 2017. Key highlights include a better than expected cash balance of over £6.0m (vs. GECR forecast of £5.2m), in-line with expectation adjusted operating profit of £3.9m and slightly below expectation revenue of £21.5m (vs. GECR forecast of £22.1m). The software and IT services group added that it’s well positioned to make further progress during the current financial year (FY18). Accordingly, we update our forecasts for both FY17 and FY18. We will issue forecasts for FY19 on the back of the full-year results announcement, which is scheduled for release on 28th Nov. 2017. We continue to classify the shares as a hybrid growth and income stock, with the shares offering investors exposure to the high-growth Enterprise Resource Planning software market and a decent prospective dividend yield of 4.17%.