Johns Lyng Group's (AX:JLG) FY17 results delivered further growth in DPS and NAV and highlighted the increasing internationalisation of the business. The announcement of a rights issue to fund future growth was unexpected, but we see significant opportunity in the global infrastructure market. At the current share price of c 260p, JLG stands at a significant discount to its adjusted NAV per share of 281p.
FY17 results: NAV growth exceeds forecasts
JLG again posted growth in the key benchmarks of reported NAV per share (+10.5% to 306p versus Edison FY17e of 302p) and DPS (+30.2% to 10.61p, including special). In a year characterised by high levels of activity, JLG disposed of investments worth £289m (initial guidance of £200m) and entered into investment commitments of £383m (£200m). Opportunities for growth remain strong and JLG guides to investment commitments and disposals of c £250m for FY18 and FY19 (before the rights issue). The pipeline of new investment opportunities stands at £2.15bn (2016: £1.86bn).
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