Growth Company Investor: Epic 'strong buy'
Brighton-based Epic designs, develops and delivers e-learning solutions
to private and public clients including household names like Barclays,
Lloyds TSB, The
Royal Bank of Scotland, the Cabinet
Office, the Inland Revenue and Customs & Excise.
A highly cash generative online learning venture, it pleased followers
with stellar interims to 30 November that comfortably topped analyst
expectations - thanks to its balance sheet strength Epic can move
quickly on potential acquisitions.
Pre-tax profits powered ahead 400% to £1m on a 39% turnover leap
to £4.6m, period end cash balances improved by a healthy 41% to
£10.4m and shareholders receive a maiden payout of 0.4p. The gross
margin was maintained at an impressive 49%.
Chief executive Donald Clark says the public
sector now accounts for over 50% of revenues and private sector
sales grew by 20% over the half, with financial services Epic's
largest individual sector. "As with email or the Internet"
commented chairman Michael Inwards, "we believe that online
learning is irreversible, as the cost savings once implemented are
considerable".
House broker Altium is a fan, and predicts full year profits of
£1.8m, for earnings of 4.9p a share. Epic has shown sales growth
is returning following restricted training and IT spending in its
last financial year to May and has a buoyant balance sheet with
no debts. On a forward p/e of 16.8, the shares look a strong buy."
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