Investment Matters

Company news: CML Group

CML Group made a positive announcement regarding an acquisition, and its unaudited financial performance for the half ending 31-Dec-15.  (Please note that the CML hybrid is held in your equity portfolio.  However, as a hybrid holder, the sustainability of the issuer's earnings is important [which they clearly are].  Additionally, and more specifically for the CML hybrids, it is convertible into equity.)

CML has acquired CashFlow Advantage.  The acquisition provides a meaningful step-up in size to CML's invoice financing business, and expands operations to Sydney.  The acquisition was made on favourable metrics, and is expected to take 3 months to integrate (the companies use the same CRM and management software).

Additionally, CML made a preliminary announcement of its H1 FY-16 accounts.  EBITDA (earnings before interest, tax, depreciation and amortisation) increased 49% as compared to the pcp, and net profit was $0.5mill (vs $0.1mill pcp).

The CML hybrid provides a strong 9% yield, and the possibility of conversion into equity in coming years.