Research published today by Kirchhoff Consult, a German financial and corporate communications agency, has analysed the latest financial results of 108 small caps that listed in Europe in 2019, and found that 42 operated at a financial loss last year, compared to 38 in 2018.
The research, which was commissioned by MBH Corporation, a UK-headquartered listed diversified investment holding company, also revealed that only 57 of the companies saw their revenue increase between 2018 and 2019 and just 30 saw their operating income (EBITDA, EBIT) rise.
Out of the 108 newly listed small caps, only five paid a dividend to investors for the last financial year.
This research clearly shows that an IPO doesn’t always lead to stronger performance and increased revenue."
In contrast to these findings, for the year ended December 2019, MBH Corporation PLC achieved sales growth of 306% to £50.8m (2018: £12.5m) and a net profit of £3.6m - an increase of 190% compared to the previous year (2018: £1.3m). It also confirmed its first dividend of €0.5 corresponding to a dividend yield of 1%.
Its EBITDA increased by 215%, to £5.2bn.
Callum Laing, CEO of MBH Corporation said: "This research clearly shows that an IPO doesn't always lead to stronger performance and increased revenue. In the two years since we listed, we've managed to sustain our growth by executing a proactive programme of finding highly successful, profitable and well-established businesses to add to our portfolio."
Bloomberg SASB indices