Lighthouse Group

LN: LGT

£33.6m market cap

26.3p last close

Lighthouse comprises a diverse group of UK financial advice firms serving individuals and businesses. The main focus is on Middle Britain and contracts with 23 affinity groups are an important revenue and profit contributor.

Investment summary

FY18 revenues were held back by the impact on client demand of the Q4 equity market correction and a levelling off in pension transfer activity. Nevertheless, revenue generated from affinity relationships continued to grow. Recurring revenue was up 10% and now accounts for more than 50% of customer revenue. The opportunity for the group to generate good long-term growth by meeting the need for financial advice, particularly within its affinity relationships, remains attractive.

Y/E Dec
Revenue (£m)
EBITDA (£m)
PBT (£m)
EPS (p)
P/E (x)
P/CF (x)
2017A 54.1 3.2 2.5 1.49 17.7 N/A
2018A 53.4 3.4 2.6 1.54 17.1 N/A
2019E 55.2 3.6 3.0 1.76 14.9 N/A
2020E 57.2 3.9 3.5 2.03 13.0 N/A
Last updated on 21/03/2019
Industry outlook

While an uncertain market background may dampen near-term demand, the key longer-term drivers of growth remain in place: an ageing population, and increased choices and responsibility for pension accumulation and decumulation. LGT appears well-placed to address this opportunity with a particular focus on developing its affinity relationships. LGT signals that it may invest in recruiting advisers to provide capacity to exploit this opportunity.

Last updated on 21/03/2019
Share price graph
Balance sheet
Forecast net debt (£m) 9.2
Forecast gearing ratio (%) 666
Price performance
%
1m
3m
12m
Actual (3.7) 17.4 19.0
Relative* (4.5) 7.8 16.5
52-week high/low 38.7p/21.2p
*% relative to local index
Key management
Richard Last Chairman
Malcolm Streatfield CEO
Peter Smith CFO

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