YouGov shares gains on modest revenue growth

LONDON - YouGov plc, the international research and data analytics group, reported a revenue increase for the fiscal year ending July 31, 2024, but saw a significant drop in statutory operating and pre-tax profits, according to unaudited preliminary results released today. The company's revenue rose to £335.3 million, marking a 30% increase from the previous year, with a modest underlying growth of 3%. Adjusted operating profit saw a slight uptick of 1% to £49.6 million.

Shares of YouGov jumped on the news, rising 10.7% by 11:31 AM London Time.

However, the company's statutory operating profit plummeted by 75% to £10.9 million, primarily due to exceptional costs associated with the acquisition of Consumer Panel Services (CPS) from GfK GmbH and restructuring charges. Adjusted profit before tax fell by 21% to £45.0 million, and statutory profit before tax dropped dramatically by 91% to £4.0 million. Adjusted basic earnings per share decreased by 29% to 29.4p, and statutory basic earnings per share turned negative to (2.0p).

Despite the varied performance across regions, YouGov maintained a robust balance sheet with cash at the period end of £73.6 million and a leverage ratio of 1.7x net debt to EBITDA. The company also reported an operating cash generation decrease of 21% to £53.9 million and announced a dividend of 9.00p per share, a 3% increase from the previous year.

Operational highlights for the year included the acquisition of CPS, a leader in household purchase data, for a headline purchase price of €315 million in January 2024. YouGov also completed the acquisition of Yabble post-period, which is expected to transform its Data Products segment through Yabble's AI platform.

YouGov launched a cost optimisation plan on August 6, 2024, aiming for annualised cost savings of £20 million, with initial actions on approximately £17 million. The company expects to realize 70% of these savings in FY25, primarily in the second half of the year.

The company's CEO, Steve Hatch, acknowledged FY24 as a challenging year but expressed confidence in the strategic progress made, including acquisitions that strengthen YouGov's product offer and technology. Despite slower sales bookings in H2 FY24 and a challenging macroeconomic environment, YouGov expects to meet current market expectations for FY25, with growth anticipated to be second-half weighted.

This financial update is based on a press release statement from YouGov plc.

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Source: Investing.com