Next Fifteen Communications Group PLC (LON:NFC) said it has raised expectations for the current fiscal year after a strong final quarter, the third hike in its current financial year.
The company said revenues for the three months to the end of January are expected to be up by roughly 9% year-on-year, with a return to modest like-for-like revenue growth.
The operating profit margin has also shown strong growth compared with last year. As a result, the group’s board expects that results for the year ending January 31, 2021, will be ahead of current market expectations.
The group’s business-to-business (B2B) technology-focused agencies continue to lead the resurgence but the business-to-consumer (B2C) agencies are also seeing a strong recovery, it added.
Next Fifteen said its revenues in the US and the UK strengthened as the financial year wore on, and it is likely that the second half of the year will see the like-for-like decline in revenues clock in at about 1.5% from a year earlier after a 6.6% decline in the first half.
The group, mindful of the continued impact of the coronavirus pandemic on the global economy, said it remains cautiously optimistic about trading as it starts its 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, Door Dash, and Goodyear,” the group said in the trading update.
Next Fifteen remains highly cash generative and has around £10mln on the books after the early repayment of valued added tax deferred from earlier in the year.
The group said it expects to resume recommending the payment of dividends following its annual general meeting in June.