Wednesday, 9 September 2009

Morse – will new year bring new hope?

(By Anthony Miller – Wednesday 9th September 2009 7:30am). It’s been a difficult year for Morse, to say the least, and if you trawl the UKHotViews archive you’ll see what I mean. A few weeks ago current hopes of a sale were dashed (see All bids off the table at Morse), but this news was soon followed by announcements (including today) that basically saw off the rest of Morse’s investment management consulting business (ex-CSTIM).

There’s a lot to consider in today’s prelims which deserve deeper consideration. At least the company is back in profit (on continuing operations), though this was due to a timely tax credit. Operating profit was just £172k on £212m revenues.

Morse is still being run as four business units (actually, four-and-a-bit if you include the STaG BSF project), though having said that, when you peek under the covers, you’ll see that Business Applications Services is in fact 3 separate businesses itself (including, of course, SAP consultancy Diagonal). With the exception of the Infra units in Spain and Ireland, ‘adjusted’ margins look better. As a result, adjusted margins on the remaining core businesses crept up 20bps to 3.9%.

Both chairman Kevin Loosemore and CEO Mike Phillips recognise that there are still challenging times ahead. But how much of Morse will be left to report on this time next year is the key question. More later.

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