The Investment Column: Reassurance for LLP float

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The Independent Online
LLOYD'S List Publishing (LLP) is sailing towards the stock market with a full head of steam. Since the management bought the business from the Lloyd's of London insurance market, turnover has grown rapidly and profits before tax and interest have almost doubled to pounds 10.3m.

That may seem strange for a group whose flagship brand is Lloyd's List, which is no doubt a must read for the shipping and insurance industry but hardly flies off newsagent's shelves. However, over the last few years LLP has turned itself into a much more diversified group, using its strong brand name to start up new titles, branch out into book publishing and conferencing and develop a powerful shipping database. The new management has also wielded the corporate knife to push margins up to an impressive 21 per cent.

Most of the cost cutting has already been completed but LLP should be able to continue to grow revenues briskly by putting its titles on the internet and expanding into electronic publishing. Just as importantly the flotation will give the group the chance to make acquisitions and reduce its onerous debt burden.

LLP has been priced at 285p a share, putting it on a historical p/e of 22. While not cheap, the stock has been valued on a discount to rivals such as Metal Bulletin, Reuters or Reed which trade on multiples in the mid to high-twenties. That should ensure that the shares get off to a good start when the group launches on the stock market on 17 April.