MENU

Did you miss the IPH Ltd (ASX:IPH) FY18 result?

Yesterday, IPH Ltd (ASX: IPH) reported its annual result for the 12 months to 30 June 2018, showing an increase in revenue.

IPH registered a 21% increase in revenue to $226 million in FY18, which includes the new acquisitions’ income. If new businesses are excluded, then underlying revenue still grew by 2% compared to the prior corresponding period (pcp).

The Australian patent market recovered in the second half with filings increasing by 1.6% in the final six months of FY18 compared to the second half of FY17. The company said it maintained its market-leading position with 23.8% of filings.

Earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 2%. The Asian segment produced a solid 5% growth in underlying EBITDA.

In October last year IPH announced it was acquiring AJ Park, the leading IP firm in New Zealand for approximately $60.9 million. Pleasingly, IPH said that the earnings contribution from AJ Park exceeded expectations.

IPH has finalised merging Fisher Adams Kelly Callinans, Cullens and Spruson & Ferguson under the Spruson & Ferguson brand. The IP company expects to create cost synergies of $1 million in the current financial year. However, one-off restructuring costs of $1 million and writing-off of brand names for $2.1 million impacted statutory profit.

Including the above-mentioned costs, statutory net profit after tax (NPAT) fell by 5%. The underlying NPAT increased by 1% excluding one-off costs.

On a per-share basis the statutory earnings per share (EPS) decreased by 7% whilst the underlying EPS fell by 1%.

The final dividend increased by 5% to 11 cents per share. The total dividends declared for FY18 showed an increase of 2.3% to 22.5 cents per share.

In the current financial year IPH will remain focused on retaining its market-leading position in Australia and Singapore. It will also consider expanding market share in other higher growth Asian regions.

The company said it will also benefit from lower net costs in the Data and Analytics Software business after selling the Filing Analytics and Citation Eagle products for $10 million. The net costs will be reduced by about $1 million, which is a decent saving.

Foolish takeaway

The market clearly liked what IPH reported yesterday with the share price rising by 5.4%. The share price has risen over 40% in the last six months.

IPH is trading at around 19x FY19’s estimated earnings. I think IPH could be well-positioned for long-term growth considering how Asia is likely to become an increasingly strong economic region and require IP services. However, it’s not on my own personal watchlist.

Another Aussie business that’s looking to take advantage of Asia’s strength is this ASX stock which is a market-leader in the auto industry.

Breaking news: ASX companies set to raise dividends!

It's been a nail-biter of a reporting season here in the first half of 2018.

But the real action, in my opinion, is what companies are doing with dividends.

What does this mean for you? Well there is one stock I've found that could very well turn out to be THE best buy of 2018. And while there's no such thing as a 'sure thing' when it comes to investing - this ripper might come as close as I've ever seen.

Click here it's FREE!

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended IPH Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The 5 mining stocks we’re recommending in 2019…

For decades, Australian mining companies have minted money for individual investors like you and me. But if you believe the pundits and talking heads on TV, those days are long gone. Finito! Behind us forever…

We say nothing could be further from the truth. To earn the really massive returns, you’ve got to fish where others aren’t fishing—and the mining sector could be primed for a resurgence. That’s why top Motley Fool analysts just revealed their exciting new research on 5 ASX miners they believe could help you profit in 2019 and beyond…

Including:

The best way we see to play the global zinc shortage… Our #1 favourite large-cap miner (hint: it’s not BHP)… one early-stage gold miner we think could hit the motherlode… Plus two more surprising companies you probably haven’t heard of yet!

For free access to our brand-new research, simply click here or the link below. But be warned, this research is available free for a limited time only, and we reserve the right to withdraw it at any time.

Click here for your FREE report!