The Future (LSE: FUTR) share price has been on a heck of a run in recent times. Up 162% over the past 12 months, the FTSE 250 share has enjoyed a double-digit daily rise in Wednesday trading following the release of strong first-half results.
At £26.64 per share, the Future share price is currently up 11% in mid-week business.
Future’s on a roll
Future is the publisher of world-famous magazines like Marie Claire, FourFourTwo, and Country Life. And it announced today that revenues had climbed 89% during the six months to March, to £272.6m. This in turn allowed pre-tax profit to more than double year-on-year to £56.9m.
Future said that organic turnover was up 21% from the same 2020 period. It also said that its plan of “accelerating growth through acquisitions continues to deliver”. Performance was particularly strong at its TI Media unit, which it acquired in April 2020. Online user growth and e-commerce revenues expansion here rang in at 54% and 277% respectively.
As a result of its “exceptional” first half, Future reckons that full-year results will be “materially ahead of market expectations”.
Take 1
Commenting on the results, media analyst Fiona Orford-Williams of Edison Group called Future’s first-half numbers “a very strong set of results”. She added that “with momentum continuing into the second half, there will be upgrades to come”.
While the publisher’s sales have been helped by Covid-19 lockdowns boosting people’s time online and their propensity to use e-retail, she added that “underlying growth comes from management’s clear and consistent strategy”. She said that this masterplan intends “to invest in specialist content, have a robust and scalable platform and use the data to drive relevant advertising and give a direct connection with eCommerce”.
Take 2
Sophie Lund-Yates, equity analyst at Hargreaves Lansdown, called Future’s latest trading update “a stonking set of results” that “suggest at least for now [that] the business is futureproof”.
Lund-Yates noted that “the meteoric rise in revenues has been boosted by acquisitions,” though she added that “crucially organic growth showed up in a big way too”. She noted the contribution of increased online shopping, too, with Covid-19 adding an extra £5m to Future’s e-commerce sales in the first half. And she added that “Future’s tech platform means the business is enjoying the benefits of scale too” with margins improving.
However, Lund-Yates warned that “the share price valuation is sky high compared to the longer-run average”. While “a clear mark of confidence” she added that “the share price could come back down to earth with a bang if things don’t go to plan”. She added that the UK publishing share needs to prove that organic sales can “stay the course”.
City analysts think that Future’s earnings will rise 30% in the fiscal year to September 2021. This leaves the FTSE 250 company trading on a forward price-to-earnings (P/E) ratio of 27 times.
