Homeserve H1 net debt increases due to capital investment

18th Nov 2014 10:32

Homeserve, a home emergency repairs business, saw its net debt rise significantly during the first half of the year despite an increase in adjusted earnings and revenues.Net debt rose from £40.7m to £75.8m during the first half, due an increase in working capital, ongoing capital investment and payment of the final dividend of £25.1m in the period.However, revenue increased slightly from £241.3m to £241.7m, while adjusted earnings per share rose from 5.5p to 5.6p.Profit before tax, adjusted for amortisation of acquisitions and exceptional income, rose to £26m from 25.6m same time last year.Cash and equivalents declined from £94.4m to £76m.Homeserve said it increased its number of customers in the UK to 100,000 from 80,000 during the same period last year. In the US, the number rose 20% to 1.7m, while in Spain the number increased 77% to 1m. In total, the company has 16% more customers than in the first six months of 2013.The group invested in its Italian business and in ongoing test marketing in Germany.Chief executive Richard Harpin said the company remained confident in meeting its expectations for the full year."Across the group we continue to focus on delivering consistently high levels of customer service."Liberum analysts gave the stock a 'buy' recommendation and a price target of 400p.Shares were down 0.71% to 337.6p on Tuesday at 11:14.