Rigby Group reveals plans to double asset base

ONE of the region’s largest private companies has stated its intention to double its asset base over the next decade.

Sir Peter Rigby, chairman and chief executive of the Rigby Group, said the group’s acquisitive strategy would continue in line with the company’s strategic ambitions.

“As a group we continue to grow and our strategic vision is bearing fruit through both organic and acquisitive development across our portfolio of businesses and operations. Overall, we have further ambitions and aim to double the group’s asset base over the next decade,” he said.

His comments came as the group revealed a dip in full year revenues. For the year to March 31, 2015, the group saw revenues of £1.62bn (2014: £1.71bn). Nevertheless, group pre-tax profit was up 65.5% to £15.9m (2014: £9.6m).

The group comprises six core divisions: technology, airports, hotels, real estate, financial services and aviation.

It has blamed the decline in revenues on the performance of its Technology division (SCC). SCC UK, which comprises Specialist Computer Centres and M2 Digital, saw revenue fall 13.3% as operations migrated from low margin products.

Nevertheless, the strategic transition of the operation kept SCC UK growth plans on track with Data Centre Services revenue up 87%.  Total services revenues reached £159m, up 22% and accounted for 24% of total UK income. Gross profit increased 15% and the margin rate was up 3.7% in the year to 15.5%.

EBITDA was up 26% on the prior year to £19.4m, with pre-tax profit at £12.4m, up 11%.

In the group’s Airports division revenues grew 58% to £34.3m (2014: £21.6m).

The airports division comprises Coventry Airport, Exeter International Airport and Norwich International Airport. The group also operates Blackpool International Airport and Derry airports for their owners, together with the Daedalus airfield for the Homes and Communities Agency (HCA). Collectively, the group transited 1.8m passengers for the year ended March 2015 compared to 1.7m in 2014.

Total airport revenues grew 58% to £34.3m (2014: £21.6m), with EBITDA, excluding exceptional items, increasing by 880% to £3.70m (2014: £0.42m). Pre-tax profit was £2.58m compared to a loss of £0.2m in 2014.

The group currently owns nine luxury hotels in the Midlands and South West, including Mallory Court in Warwickshire and Brockencote Hall in Worcestershire.
Total revenues for the group were up 52% to £15.1m (2014: £9.9m), mainly due to the acquisition of Bovey Castle in Devon during the year. EBITDA was down by 50% to £0.3m (2014: £0.6m), due to increasingly competitive market conditions and the division also made a loss before tax of £0.1m (2014: £0.2m pre-tax profit).

The real estate division continued to develop its two core businesses: super prime London residential development (via Rigby & Rigby); and commercial property development. Rigby & Rigby has a strong market presence in London.  

Total revenues were up 106% to £13.0m (2014: £6.3m), with EBITDA up 300% to £1.2m (2014: £0.3m). The operation made a pre-tax profit of £0.7m (2014: £0.1m).

The group strengthened its Financial Services division with the launch of its Rigby Capital Leasing Services businesses in the UK and has rebranded the French business as Rigby Capital with the intention of becoming a leading force in the provision of financial backed managed services. Rigby Capital is aiming to generate turnover of £75m in the UK within two years.

The group has also launched Rigby Private Equity, a fund managed under the Rigby Equity Investments brand. The division made its first acquisition in July 2015, by making a significant investment in specialist, high value-added distributor Wick Hill Group. The deal will allow Wick Hill to grow further in the UK and Germany, as well as giving it a major opportunity to expand into Europe and the Middle East.  Further acquisitions will be completed before the end of calendar year.

Pre-tax profit generated from the investment portfolio managed by the group reached £6.1m (2014: £1.6m), boosted by improvements in stock markets during the year.

The aviation division saw revenues increase by 49% to £14.5m (2014: £9.7m), with EBITDA, before exceptional items, up to £0.4m compared to an EBITDA loss of £0.7m in 2014, as the business was restructured to reduce its reliance on general aviation activities and increase revenues underpinned by long term contracts. As such, the loss before tax remained consistent at £3.6m (2014: loss of £3.4m).

Steven Rigby, Group Chief Operating Officer, said: “Our strategy remains on course and we have the capital available to continue to be acquisitive across our core divisions. We have launched new financial divisions with Private Equity, Investments and Leasing: these divisions will become increasingly important in future years.”