Potential Equity Issue
AFH (O:AFH) is reporting strong organic and inorganic growth with a 30%+ increase in turnover FY15 on FY14. We have increased our FY15 revenue estimates by 4%, all of which is above expected organic growth. The company expects the FY15 results to be above market expectations. It also highlights that it is considering issuing further equity to take advantage of current market opportunities. We expect the latter to be measured and consistent with evolutionary rather than revolutionary acquisitions.
FY15 trading update
AFH reports a strong H215, with revenues for the full year expected to exceed £20m (H115: £8.22m, our previous estimate £19.7m). Despite funding significant acquisitions, cash balances at 31 October 2015 were in excess of £3m (in line with our previous estimate of £3.3m). Funds under management are reported as approaching £2bn at 31 October 2015. Management reports strong organic growth and we note that any beat against our estimates will be all organic growth. AFH has increased its national footprint by completing 11 acquisitions (including a small one not requiring RNS announcement) in FY15.
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