IPH Limited Impresses with Financial Results

Posted at Legal Practice Intelligence - 18 August 2016 - by Peter Frankl

IPH Limited has announced its full year 2015/16 financial results.

The original firm that is now IPH Limited was Spruson & Ferguson (patent and trademark attorneys). The company listed on the ASX in November 2014. The share price is currently around three times the listing price.

At the time of listing, the owners of Spruson & Ferguson sold slightly more than half their equity for around $166 million. In FY 2014 the company reported $65 million of revenue (net of recoverables).

The money raised at listing went to the owners and not into the balance sheet of the company. In November 2015 IPH Limited raised $60 million as a capital raising. The company acquired Fisher Adams Kelly, Callinans, Pizzeys and Cullens. The $60 million raised has enabled IPH Limited to end financial year 2016 with zero bank debt.

As at 30 June 2016 there was still $27 million in the balance sheet  of potential earnout liabilities to owners of acquired firms as well as $28 million of tax provisions. The company had $58.5 million in cash and cash equivalents.

Revenue in 2015/16 was $116 million (net of recoverables) and EBITDA was around 41%.

In summary, turnover has increased by 78% since 2013/14 or $51 million. The company is more profitable than at the time of listing and there is no bank debt.

Contributing to these excellent results is the company’s ability to keep staff costs at a good level in proportion to revenue. Staff costs in 2015/16 were $40 million or 34% of revenue (net of recoverables). This is the ratio that has been most challenging for other listed professional services firms. IPH Limited is showing how it is done.

Video from May 2016


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