RELX Group reports in line half-year figures

Professional data, news and analytics tools provider RELX Group saw profit growth jump ahead of sales in its first set of consolidated results ahead of the merge of its Dutch and UK parent companies.

Underlying revenue growth for the first six months of the year hit 3% to reach £2.96bn (Numis: £3bn), while operating earnings sped ahead by 5% to £909m (Numis: £916m).

"Our financial position and cash flow remain strong, and investment in organic growth remains our number one priority for cash use, supported by small acquisitions of datasets and analytics," chief executive Erik Engstrom said in a statement.

All four of the company’s business units, Scientific, Technical & Medical, Risk & Business Information, Legal and Exhibitions, contributed to the improvement in revenues and profits, driving an 8% increase in adjusted earnings per share to 30.1p.

In its previous incarnation, as Reed Elsevier, the company announced a name change back in February alongside plans to simplify its corporate structure, share listings and corporate entity names.

The simplification was on track to complete on 1 July subject to shareholder approval, it said.

"The key drivers within our business remain positive, and we are confident that we will deliver another year of underlying revenue, profit, and earnings growth in 2015," Engstrom added.

The dividend pay-out for its London-listed shares was boosted 6% to 7.40p per share and that for its Dutch arm, RELX NV, by 17% to €0.115 per share.

The firm highlighted what it described as its strong financial position and levels of cash conversion, with leverage standing at 2.5 times EBITDA on a pension & lease adjusted basis or 1.9 times on an unadjusted basis.

Analysts at Numis described the figures as “solid” although it is “very hard to get too excited about anything in this statement”.

Even so, “RELX remains a safe place to hide in the sector in our view,” analysts Gareth Davies and Paul Richards said in a research note e-mailed to clients.

The broker retained its ‘add’ recommendation and 1,200p target price.

As of 10:43 the firm’s London-listed shares were up by 0.55% to 1,099p.