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Why is the IPH (ASX:IPH) share price charging 8% higher?

The IPH share price is charging higher today, up 8% in late morning trade. We take a look at the company’s latest results.
The post Why is the IPH (ASX:IPH) share price charging 8% higher? appeared first on The Motley Fool Australia. –

A young man pointing up looking amazed, indicating a surging share price movement for an ASX company

The IPH Ltd (ASX: IPH) share price is charging higher today, up 8% in late morning trade.

The share price gains come following the release of the intellectual property services provider’s results for the financial year ending 31 December (H1 FY21).

Financial results for H1 FY21

In this morning’s ASX release, IPH reported it had managed a strong half-year, despite headwinds from a stronger Aussie dollar and the market disruptions caused by COVID-19.

The company reported statutory net profit after tax (NPAT) of $26.8 million. That was down 1.5% from the $27.2 million reported in the prior corresponding period(PCP). Diluted earnings per share (EPS) also slipped to 12.4 cents from 12.9 cents in H1 FY20. IPH said an increase in non-cash amortisation of intangible assets had impacted the statutory results. This was directly related to its Xenith IP acquisition

Underlying NPAT increased 3% to $37.6 million while underlying earnings before income, tax, depreciation, and amortisation (EBITDA) grew 2% to $61.7 million.

Operating cash flow increased by 39% year-on-year.

The company also bumped its interim dividend up by 4% from the prior corresponding half year. Resulting in 14 cents per share (cps), 50% franked.

Commenting on the results IPH CEO, Andrew Blattman said:

Our Asian IP business continues to perform well. While revenue was down slightly on the prior period, we continued to generate margin accretive earnings from leveraging our extensive network across the region, including a 39% increase in client patent and trade mark referrals from acquired companies (AJ Park and former Xenith businesses)…

Our business in China and Hong Kong SAR performed well in the half with excellent filing growth of 18% and 23% respectively. In Singapore, IPH Group maintained its number one patent market share of 23.2% for the calendar year ended 31 December 2020.

IPH also remains the market leader in Australia. It reported a combined group patent market share of 36.8% for the half-year. This is said to include Baldwins on a proforma basis and excludes innovation patents.

Share price snapshot

The IPH share price has yet to recover from the hit it took in 2020. This was due to the wider COVID-driven market selloff that occurred last year. Over the past 12 months, shares are down 33%. That compares to a 3% loss on the All Ordinaries Index (ASX: XAO).

With today’s intraday gains factored in, the IPH share price is up 1% so far in 2021.

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Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends IPH Ltd. The Motley Fool Australia has recommended IPH Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Why is the IPH (ASX:IPH) share price charging 8% higher? appeared first on The Motley Fool Australia.

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