Revenues increased 13.8% to £489.1 million, slightly ahead of the consensus, while pre-tax profits were 14.6% higher at £68.3 million, translating into underlying earnings per share up 13.3% to 47.89p.
Higher revenues were driven by organic growth in Children’s Services, the transfer of assets from the Huntingdon Group to the Adult Specialist Services division and the acquisition of technology group Smartbox.
The Foster Care division accounting for around 8% of revenues was the only part of the business to see a contraction in revenues as it was impacted by Covid-19 restrictions and a reduced number of foster parents.
Strong cash conversion saw a reduction in net debt to £258.7 million from £268.9 million despite the firm spending £11.8 million on property, adding 25 sites, and the £5.4 million purchase of Smartbox.
Net debt to adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization), a measure of leverage, fell to 2.7 times from 3.1 times in 2020.
The company continued its progressive dividend policy with the board recommending a final pay-out of 9.5p per share, taking the full year dividend to 14.1p per share, up 10.6% on last year.
The company said its fundamentals remained strong and it continued to see ‘an active pipeline’ of bolt-on acquisition opportunities on top of growth in the Gulf region as well as opportunities to develop its fledgling technology business.
At the end of November the company acquired REHAVISTA, Germany’s largest provider of augmentative and alternative communication products and services.
The company said the combination of Smartbox and REHAVISTA is expected to be immediately earning enhancing and represents a significant opportunity for Smartbox to expand its range of products and services in Germany.
Smartbox has a global customer base spanning more than 30 languages and 45 distributors.
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