Wilmington says new year on track, FRA business to be sold

(Sharecast News) - Annual results from Wilmington on Monday were in line with market forecasts following a detailed trading update in July, with the data, information, education and training services company pointing to a "good start" to the new financial year. Wilmington also revealed that its struggling US healthcare events business FRA - where revenues fell 25% year-on-year in sterling terms due to funding uncertainties in the industry - is to be marketed for sale.

The company, which is focused on the governance, risk and compliance (GRC) markets, reported 11% revenue growth over the 12 months to 30 June to £99.5m, with seven of its nine businesses posting an improvement year-on-year.

Annual recurring revenues were up 5% and now account for 36% of organic revenues, up from 34% previously.

Adjusted pre-tax profits from ongoing businesses were up 18% at £28.4m, though statutory pre-tax profits fell 24% to £18.4m as profits from sold businesses were not repeated.

"Our ongoing businesses have delivered another good financial performance," said chief executive Mark Milner.

"Our focus on portfolio management and a continuation of the strategy to expand our positions in GRC markets has resulted in further strong revenue performance, profit growth and cash generation. Both of our recent acquisitions have seen double digit growth and margins have also continued to improve."

Looking ahead, the company said revenues and profits for the current year are expected to be in line with expectations, bolstered by the post-year-end acquisition of Spanish GRC and regulatory compliance business Conversia for £105m.

Commenting on the results, analysts at Berenberg said in a research note that the "positive progress" over FY25 contrasts with a 14% year-to-date fall in the stock, which was a result of softer trading at FRA.

"With the brand set to be divested and an expected earnings-accretive impact from Conversia yet to be reflected in forecasts, we view a FY26 P/E of 13.9x as a clear mispricing, given the growth potential and earnings quality Wilmington offers," they said.

Shares were up 3.0% at 345p by 1038 BST.