Connect Group revenues lift ahead of expectations

Connect Group said overall performance was marginally ahead of expectations.

Shares in the firm lifted slightly on the news, by 2.78% to 148p as of 13:59 on Tuesday.

Revenues in the firm’s news segment were down 3.4% and book revenues were down 1.1%.

However, sales in its education and care segment lifted 1.9%.

Connect Group said the new parcel freight division increased its revenues by 20.6% driven by market growth.

N+1 Singer upgraded its rating from ‘hold’ to buy’ and said the parcel freight division was an excellent addition to the group.

“It is a specialist business with good margins (high single digit) and an impressive track record of revenue and profit growth.”

“After the disappointments of previous acquisitions, we think this could be the acquisition that succeeds in bringing a leg of growth to the Connect investment case,” N+1 Singer said in a note.