A positive outlook as insolvency volumes build

A strong first half performance included double digit revenue and profit growth in line with the recent update. The FY24 outlook is positive: the statement anticipates growth towards a £200m pa medium-term revenue target. That characterises the potential management sees and its confidence in the visibility and repeatability of its current strategy.

Recent investment has put BEG in a good position to extract growth both organically and via further additions. Recent acquisitions are reported to be trading in line with expectations and organic initiatives delivering. We expect the group to deliver more of the same, but don’t rule out larger acquisitions, finance for which is readily available with £1.1m of net cash at end October and significant headroom within committed bank facilities.

The statement anticipates growth in insolvency activity and a broadly consistent H2 for financial advisory. Property advisory and transactional services are also on track to report another year of strong growth. We increase our revenue forecast but hold both adjusted PBT at prior levels as well as our 175p/share fair value (equating to 18.2x FY24e PER, 2.1% yield).