Hogg Robinson Group PLC Stock: Fraedom To Grow
Edison | Aug 03, 2016 05:39AM ET
Hogg Robinson Group (LON:HRG) recently provided insight into its technology business, Fraedom, which offers payments, expenses and travel software tools. We explore Fraedom in more depth, looking at the growth strategy, competitive positioning and financial prospects for this part of HRG’s business. This well-established, profitable business looks set to contribute to the group’s growth over the medium term.
More of the same in Q117
HRG is on course to meet market expectations for the current year after an opening quarter to June much in the vein of H216, ie relatively subdued travel management (revenue -3% in constant currency) offset by Fraedom’s buoyancy. While our full-year PBT forecast is unchanged, it now assumes greater caution in travel management, given a broadly similar outlook, compounded by possible Brexit softening, of which there are very early signs.
We look now for divisional revenue to continue to decline at that rate but at maintained margin, thanks to effective cost control in FY16 and guidance of £8m further savings from reorganisation. Favourable currency movements should make good the consequent profit shortfall. We remain confident that Fraedom will deliver c 20% trading profit growth.
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Hogg Robinson Group - Fraedom To Grow
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