Last close As at 05/08/2026
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Market capitalisation
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Research: TMT
YouGov’s pre-close trading update indicates that it will have outperformed market estimates for the year ended July, with particularly strong growth from the UK and US. We have raised our numbers to reflect this and May’s acquisition of SMG Insight. The focus on driving higher-margin products and services is showing through in the numbers and the improving quality of earnings. The custom business is being reoriented towards more scalable and repeatable work, also with a beneficial impact on margin. The premium rating reflects the growth record and positive outlook.
YouGov |
US and UK powering on |
Year-end trading update |
Media |
30 July 2018 |
Share price performance
Business description
Next event
Analysts
YouGov is a research client of Edison Investment Research Limited |
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YouGov’s pre-close trading update indicates that it will have outperformed market estimates for the year ended July, with particularly strong growth from the UK and US. We have raised our numbers to reflect this and May’s acquisition of SMG Insight. The focus on driving higher-margin products and services is showing through in the numbers and the improving quality of earnings. The custom business is being reoriented towards more scalable and repeatable work, also with a beneficial impact on margin. The premium rating reflects the growth record and positive outlook.
Year end |
Revenue (£m) |
PBT* |
EPS* |
DPS |
P/E |
Yield |
07/16 |
88.2 |
14.4 |
8.5 |
1.4 |
57.9 |
0.3 |
07/17 |
107.0 |
17.9 |
10.5 |
2.0 |
46.9 |
0.4 |
07/18e |
116.5 |
23.0 |
14.3 |
2.5 |
34.4 |
0.5 |
07/19e |
128.6 |
26.2 |
15.8 |
2.8 |
31.1 |
0.6 |
Note: *PBT and EPS are normalised, excluding amortisation of acquired intangibles, exceptional items and share-based payments.
Data products and Services momentum
Our pre-tax and EPS forecasts are raised by 9% (on top of a 6% increase in March), in part reflecting the acquisition of SMG in May but more from the strong trading outlined in the statement, despite a currency headwind from the US dollar. This gives FY18 forecast year-on-year growth in adjusted EPS of 36% (on 10% revenue growth), with current numbers showing 10% further EPS growth in FY19e. The momentum in BrandIndex, Profiles and Omnibus continues, driving operating margins in the products and services segments. A degree of caution had been built into our custom research numbers regarding the strategic reorientation away from one-off, bespoke projects (often sizeable) towards higher-margin projects. At the interim stage, custom research operating margins had reached 24%.
Investment in building scale
YouGov is a highly cash-generative business (FY17 cash conversion of 130%; FY16: 130%). Net cash at the half year was £21.3m and our year-end estimate is for £26.4m, giving plenty of scope for further investment. This has been focused on technology but also on broadening the geographic base of the group. There are new offices in Spain and Italy, increasing the group’s ability to offer pan-European coverage, along with the opening of a Mumbai office, announced in February this year. The acquisition of the outstanding 80% in SMG Insight in May has given the group a strong position in sport. It can now develop further products in this vertical, measuring and evaluating media and sponsorship deals.
Valuation: Premium rating for premium growth
YouGov’s rating remains at the top of the ranking of global peers, with much of the traditional market research sector still struggling with legacy infrastructure. YouGov continues to refine and productise its offerings, driving a higher earnings CAGR than the sector and funding a progressive dividend stream. The group’s clear and consistent strategy is translating into profits and, at least as importantly, into cash.
Exhibit 1: Financial summary
£'000s |
2016 |
2017 |
2018e |
2019e |
||
Year end 31 July |
IFRS |
IFRS |
IFRS |
IFRS |
||
PROFIT & LOSS |
||||||
Revenue |
|
|
88,202 |
107,048 |
116,500 |
128,574 |
Cost of Sales |
(19,476) |
(21,339) |
(22,156) |
(22,829) |
||
Gross Profit |
68,726 |
85,709 |
94,344 |
105,745 |
||
EBITDA |
|
|
12,874 |
17,210 |
22,312 |
25,487 |
Operating Profit (before amort., except & SBP). |
|
|
12,059 |
16,036 |
21,112 |
24,262 |
Intangible Amortisation |
(5,478) |
(6,483) |
(7,150) |
(7,150) |
||
Share based payments |
(1,138) |
(1,508) |
(1,802) |
(1,802) |
||
Exceptionals |
(1,108) |
(488) |
0 |
0 |
||
Other |
(4) |
103 |
0 |
0 |
||
Operating Profit |
4,331 |
7,660 |
12,160 |
15,310 |
||
Net Interest |
1,199 |
254 |
120 |
136 |
||
Profit Before Tax (norm) |
|
|
14,392 |
17,901 |
23,034 |
26,201 |
Profit Before Tax (FRS 3) |
|
|
5,530 |
7,914 |
12,280 |
15,447 |
Tax |
(2,111) |
(4,933) |
(5,414) |
(6,954) |
||
Profit After Tax (norm) |
11,139 |
13,116 |
15,818 |
17,445 |
||
Profit After Tax (FRS 3) |
3,415 |
4,637 |
6,664 |
8,493 |
||
Average Number of Shares Outstanding (m) |
103.9 |
105.5 |
105.5 |
105.5 |
||
EPS - normalised (p) |
|
|
8.5 |
10.5 |
14.3 |
15.8 |
EPS - FRS 3 (p) |
|
|
3.3 |
4.4 |
6.3 |
8.1 |
Dividend per share (p) |
1.4 |
2.0 |
2.5 |
2.8 |
||
Gross Margin (%) |
77.9 |
80.1 |
81.0 |
82.2 |
||
EBITDA Margin (%) |
14.6 |
16.1 |
19.2 |
19.8 |
||
Operating Margin (before GW and except & share-based payments) (%) |
12.4 |
13.6 |
16.6 |
17.5 |
||
BALANCE SHEET |
||||||
Fixed Assets |
|
|
62,366 |
64,637 |
67,037 |
67,037 |
Intangible Assets |
53,140 |
54,960 |
57,360 |
57,360 |
||
Tangible Assets |
8,984 |
9,332 |
9,332 |
9,332 |
||
Investments |
242 |
345 |
345 |
345 |
||
Current Assets |
|
|
45,339 |
54,918 |
60,696 |
70,529 |
Stocks |
0 |
0 |
0 |
0 |
||
Debtors |
28,643 |
30,699 |
32,741 |
36,135 |
||
Cash |
15,553 |
23,481 |
26,434 |
32,873 |
||
Current Liabilities |
|
|
(27,823) |
(34,177) |
(35,106) |
(38,745) |
Creditors |
(27,823) |
(33,915) |
(35,106) |
(38,745) |
||
Short term borrowings |
0 |
(262) |
0 |
0 |
||
Long Term Liabilities |
|
|
(5,793) |
(4,905) |
(5,905) |
(5,905) |
Long term borrowings |
0 |
0 |
0 |
0 |
||
Other long term liabilities |
(5,793) |
(4,905) |
(5,905) |
(5,905) |
||
Net Assets |
|
|
74,089 |
80,473 |
86,722 |
92,916 |
CASH FLOW |
||||||
Operating Cash Flow |
|
|
14,139 |
18,914 |
19,600 |
24,100 |
Net Interest |
11 |
4 |
120 |
136 |
||
Tax |
(2,365) |
(2,487) |
(5,053) |
(5,799) |
||
Capex |
(6,076) |
(7,661) |
(8,250) |
(8,250) |
||
Acquisitions/disposals |
(171) |
0 |
(1,000) |
(1,000) |
||
Financing |
16 |
175 |
0 |
0 |
||
Dividends |
(1,028) |
(1,470) |
(2,205) |
(2,732) |
||
Net Cash Flow |
4,526 |
7,475 |
3,212 |
6,455 |
||
Opening net debt/(cash) |
|
|
(10,017) |
(15,553) |
(23,219) |
(26,434) |
HP finance leases initiated |
0 |
0 |
0 |
0 |
||
Other |
1,010 |
191 |
(0) |
0 |
||
Closing net debt/(cash) |
|
|
(15,553) |
(23,219) |
(26,431) |
(32,889) |
Source: Company accounts, Edison Investment Research
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