Management Consulting in line with expectations

4th Jan 2012 14:10

International professional services group Management Consulting expects to report revenue and underlying operating profit for the 2011 financial year in line with expectations. Alexander Proudfoot, one of two divisions in the firm, has continued to benefit from demand from clients in the natural resources sector, and those with operations in emerging markets.The division is set to report significant growth in revenues in 2011 compared with 2010. The other division, Kurt Salmon, has delivered an "encouraging" performance for the year in its core markets.Management Consulting Group (MCG) said it generated cash inflow of £11m from warrant exercises, while a significant reduction in net indebtedness has been seen during the year. Net indebtedness at 31 December 2011 is expected to be approximately £31m compared with £54.4m at 31 December 2010. The group has recently refinanced its borrowing facilities and now has in place an £85m revolving facility until July 2016.Nick Stagg, Chief Executive said: "Both Kurt Salmon and Alexander Proudfoot have made good progress during 2011, despite continuing economic uncertainty.""MCG will continue to benefit from its broadly diversified business in terms of both geography and sector focus," Stagg added.Andy Hanson, an analyst at Northland Capital Partners, described the pre-close statement as "reassuring", with the company set to meet consensus earnings per share projections of 3.7p to 3.8p. This puts the shares on just over eight times expected 2011 earnings and seven-and-a-half times projected earnings per share for 2012, Hanson notes."The operating environment is likely to remain difficult during FY12 [fiscal 2012] but the improvement in the net debt position leaves the business better positioned to deal with deterioration in trading," Hanson added.__NR