Corporate insurance broker CBG Group reported more than halved profits in 2009.
Revenues slumped from £11.1m to £8.96m, while underlying profits fell from £2.25m to £1.03m. Around two-thirds of the annualised cost savings of £1.4m showed through in 2009.
Revenues and profits declined in all divisions of the business. Healthcare was one of the only bright spots anywhere in the business.
CBG has edged up its final dividend to 0.7p a share.
The outsourcing of the premium finance operations to Close Brothers did not affect the trading outcome but it has improved the balance sheet. Working capital has been reduced and net debt is down to £891,000. Deferred consideration was £1.06m at the end of 2009 and one-half of that has already been paid.
Non-core personal insurance business has been sold since the year end but that should not hit profits. Daniel Stewart forecasts 2010 profits of £1.5m, which mainly reflects the additional cost savings.
At 51.5p a share, CBG is valued at £8.07m. The shares are trading on eight times prospective 2010 earnings.
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