The DWF Group Board has approved an interim dividend for FY22 of 1.5 pence per share in line with their policy of paying one third of the prior year total dividend as the interim dividend in the following year. The interim dividend for FY22 is payable on 4 March 2022 to shareholders on the register as at 4 February 2022.
Other financial highlights include:
Group net revenue growth of 3%, (7% on a like-for-like basis), to £173.3m:
o 2% reported growth in Legal Advisory, with like-for-like growth of 7%
o 14% growth in Connected Services (7% organic)
o 8% growth in Mindcrest (all organic)
Gross margin increase of 1.7ppts from 49.6% to 51.3%, with all three divisions showing revenue growth, gross profit increase and gross profit margin enhancement.
Adjusted PBT up 40% to £18.7m and a continued downward trend in cost to income ratio dropping by 1.3ppts versus HY21 to 39.1%, reflecting profitable revenue growth and the benefits of previously announced cost reduction measures and restructuring.
Reported PBT is £11m, which is a £22m improvement on the PY loss before tax. This is due to a much lower level of adjusting items of £7.6m comprising mainly of share-based payment charges from the partner-funded EBT.
A 15 day (8%) reduction in lock-up days versus PY (and a five day, or 3%, reduction on April 21) reflects ongoing Group-wide initiatives to improve working capital efficiency.
HY22 free cash flows of £4.2m are after the repayment of £5.4m of COVID deferrals (VAT deferred under the UK government scheme). The HY21 free cash flow comparator of £19.5m benefitted from £10.4m of COVID deferrals (deferral of VAT and other taxes).
Net debt of £77.2m is higher than PY due to the repayment of COVID deferrals, settlement of deferred consideration and a one-off outflow for the restructuring of Australia, with combined LTM (last twelve month) outflows of £24.8m incurred on these items.
Total remaining COVID deferrals and deferred consideration at the October 21 balance sheet date are £6.3m compared to £12.4m at April 21 and £17.5m at October 20.
Leverage has reduced to 1.19x adjusted EBITDA (HY21: 1.44x), reflecting the downward trajectory signposted in earlier guidance.
Net revenue per partner increased by 9% to £488k (HY21: £446k).