Updates

Computer Software - Third legal acquisition

September 2006

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

CSW has bought Videss for £7.1m, mostly in cash. Videss provides a range of software and services to 180 medium to large legal practices and is the third acquisition in the legal sector. For the year to 31 March, it reported sales of £4.97m, of which £2m was from annual support contracts with the remainder a mix of licences and services. Adjusting for the retiring directors costs of £0.22m, adjusted profit before tax is £0.65m. At completion, Videss held cash resources of approximately £2.8m so adjusting for this, the enterprise value is £4.3m and the deal is immediately eps enhancing. CSW’s net debt is probably close to £16m (within the £20m facility) but is expected to ...

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Computer Software Group (October 2006)

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With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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