Hello! I bet you thought I wouldn't circle back and complete Monday's missing report, but my dedication to the cause is such that I've set aside a couple of hours on the following Sunday to fill in the gaps. As it's the day of rest, these comments will be a bit more concise than usual.


YouGov (LON:YOU)

Share price: 126.5p
No. shares: 102.7m
Market Cap: £129.9m

Interim results - covering the six months to 31 Jan 2015 - another set of uninspiring figures from YouGov. Whilst turnover increased 10.9% to £36.2m for the period, the company remained barely profitable - an operating profit of only £133k was made, a small improvement against the £138k loss last H1. There seems to be an H2-weighted seasonality to the year, as the company made an £1,039k operating profit for the full year.

I am referring above to the statutory numbers on the P&L. However, YouGov dramatically inflates its adjusted profits by capitalising some internal costs (and ignoring the amortisation charge), and has recurring exceptional costs every year.

Here is the table showing the dramatic impact on profit of the amortisation charge being ignored, and calling some things exceptional (despite them happening every year);


5518264dcf5b9YOU.JPG

Here are the exceptional costs (see below). Perhaps you could allow the acquisition related costs, but restructuring seems to be ongoing. The company does however give a fairly detailed explanation of each item below the figures, which is good. So readers can at least make up their own mind.

5518286df215eYOU_excep.JPG

Valuation - I don't believe the adjusted profit figures are a reasonable measure of the real performance of the business. So for me, the 2.6p adjusted EPS in H1 is meaningless.

Stockopedia doesn't particularly like it either, with a StockRank of 53 (falling), and bear in mind their system doesn't challenge what brokers call normalised EPS. It scores poorly on both value and quality scores, see below;

55182a355aedaYOU.JPG

Dividends - are miniscule, which is because the company doesn't really make very much money. The yield is under 1%.

Balance sheet - this is OK, and passes my usual tests.

My opinion - covered above really. I don't accept the adjusted profit figures. The market cap looks considerably over-valued in my opinion, for what is in reality, a not very profitable business.

Although on the positive side, bulls point to the…

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