LONDON (Alliance News) - Technical consultancy firm RPS Group PLC said Monday it has acquired Australian consultancy firm Corview for GBP18 million and 2018 trading had been in line with market expectations.
RPS will buy transport advisory firm Corview for a maximum consideration of AUD32.0 million - or GBP17.8 million - in cash. Of this, RPS will pay an initial AUD17.6 million on completion with further payments of AUD4.8 million on the first, second and third anniversaries of completion.
For the year ended June 2018, Corview generated AUD17.1 million in revenue and AUD5.1 million in adjusted pretax profit.
In 2017, RPS itself suffered a GBP1.6 million pretax loss on revenue of GBP630.6 million. Adjusted pretax profit stood at GBP53.9 million.
"We look for acquisitions that will add density, not greater diversity; that are value creative and that are congruent with our brand and our culture," RPS Chief Executive Officer John Douglas said.
"Corview is known for its expertise in enabling clients to make informed investment decisions and manage complex infrastructure transactions across all phases of project development and delivery," Douglas added. "This makes them a natural fit for our business and I am delighted to make Corview our first major acquisition under my tenure as CEO of RPS."
In 2018, RPS explained trading had been "in line" with market expectations. The firm expects adjusted pretax profit to be GBP50.2 million.
Conversion of profit into operating cash flow was described as being "strong". Consequently, net debt fell to GBP73.9 million at the end of 2018 compared to GBP80.6 million the year prior.
RPS reiterated its commitment to maintain its dividend and improve dividend cover over time.
"We continue to make good progress on our strategic priorities and this is reflected in our trading performance," Douglas added. "The group has healthy margins, excellent cash conversion and a robust balance sheet. RPS is a good business and the investment that we have made to date will make it an even better business in the future. We look forward to updating the market further when we report our full year results later this month."
RPS expects to deliver 2018 results on February 21. Shares in RPS were 6.8% higher at 148.86 pence on Monday.
