(Alliance News) - RPS Group PLC said it is well positioned for growth as it held a virtual capital markets event for investors and analysts on Tuesday morning.
The Abingdon, England-based professional services firm outlined its new capital allocation policy, with a key focus on organic fee growth. RPS said it intends to drive organic growth by allocating capital to strategic initiatives, which will be capable of delivering sustainable 5% organic fee growth and at least 10% operating margins.
In addition, the company said it expects to use its balance sheet to accelerate fee growth with strategic bolt-on acquisitions that are cash generative and value creative. The company explained that it plans to use debt, not shares, to finance purchases in order to avoid dilution.
Finally, RPS Group said it will implement a "sustainable" dividend policy, whilst retaining adequate capital to invest in strategic acquisitions and organic growth. RPS Group paid a dividend of 0.26 of a pence a share for the six months to June 30 versus none a year prior.
However, in the medium-term, the company said it is unlikely to consider share buy backs.
RPS Group shares were trading 0.8% higher in London on Tuesday at 126.00 pence each.
By Evelina Grecenko; evelinagrecenko@alliancenews.com
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