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UPDATE 1-Quindell says first-half revenue more than doubles
July 14, 2014 / 7:48 AM / 3 years ago

UPDATE 1-Quindell says first-half revenue more than doubles

(Adds details on share issue, background and outlook; share movement)

July 14 (Reuters) - Quindell Plc, a British IT outsourcing and consultancy services provider, said first-half revenue more than doubled, driven by a jump in sales at both its services and solutions businesses.

Shares in the AIM-listed company rose more than 16 percent, making the stock one of the top percentage gainers on the London Stock Exchange on Monday morning.

Quindell said it would issue 1.9 million new ordinary shares, or about one-third of the deferred equity consideration related to its purchase of iter8 Inc last year.

The company has also sought admission of about 17.2 million new shares on July 21, taking its total ordinary shares in issue to about 436.3 million.

Revenue rose 117 percent to about 355 million pounds ($604 million) for the six months ended June 30 from a year earlier. Adjusted pretax profit nearly tripled to about 154 million pounds, Quindell said.

Quindell’s services division, which accounts for a large chunk of the company’s revenue, more than doubled its revenue to 293 million pounds helped by a push from its legal services.

The company, which provides services mainly to the insurance and telecom industries, said solutions revenue rose 176 percent.

Quindell said the businesses acquired in the last 12 months represented less than 10 percent of total revenue.

The company said it was confident of meeting all its key performance indicators for full-year market expectations, on full-year revenue guidance of 800-900 million pounds.

Quindell also increased its “future” earnings before interest, taxes, depreciation and amortization (EBITDA) margin guidance to 35 to 40 percent.

The stock has taken a beating since U.S.-based Gotham City Research questioned Quindell’s revenue model and profit quality in April, dousing its chances of securing a premium listing on the London Stock Exchange.

Gotham City Research made its allegations in a report published on its website in April. (link.reuters.com/waw68v)

The company said it had started legal action against Gotham related to a “coordinated shorting attack” against the company.

Quindell assured investors last month that it would meet full-year cash and earnings expectations, and appointed a new chief executive.

Quindell shares were up 13.3 percent with about 2.5 million shares changing hands by 0742 GMT. ($1 = 0.5877 British Pounds) (Reporting by Noor Zainab Hussain in Bangalore; Editing by Gopakumar Warrier)

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