Published Thu, 07 Jun 2018 12:04:09 on Interactive Investor
With the short-sellers seemingly in retreat, shares in facilities manager Mitie (MTO) have taken another step forward today after well-received annual results highlighted progress in the company's rebuilding job.
Chief executive Phil Bentley, the former British Gas boss, said that after one year of the company's transformation programme Mitie was "where we need to be".
This upbeat mood is in marked contrast to the state of uncertainty facing shares in Mitie and the rest of the outsourcing sector following the collapse of Carillion at the start of this year.
With shares close to 150p, Mitie was looking vulnerable after a spate of profit warnings in preceding months had made it one of London's most shorted stocks with around 15% of equity out on loan at one point.
That's now down to under 4% after the first year of a turnaround programme in which Mitie has focused on removing complexity and duplication, while making significant investments in technology, smart analytics and data-led insight.
Source: interactive investor Past performance is not a guide to future performance
Today's results showed there's still plenty of work to do, with operating profits down 6% to £77.1 million, but in line with revised guidance. Net debt rose to £193 million, but analysts said this was better than expected as year-end leverage came in below 2 times net debt/earnings and well within covenants.
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