SHOULD THE MARKET TAKE HEART FROM LOGICA’S RESULTS?
DEREK BROWN SEYMOUR PIERCE
“One thing of note was how strong their public sector business is in the UK. It is possible that this has been driven by the sector bringing things forward ahead of the election next year, when they will be forced to cut spending. I am therefore a bit cautious about income from the public sector for 2010. But they are talking about the fourth quarter with good visibility.”
SIMON STRONG KBC PEEL HUNT
“We have concerns about outsourcing exposure to the government sector, especially in the UK, and the risk of revised terms of business going forward. This could undermine the stronger performing part of the group. Consulting is likely to remain weak for the foreseeable future, with continued pricing volume declines.”
JULIAN YATES INVESTEC
“Full-year 2009 sales guidance has been modestly reduced, but the margin outlook remains unchanged. Sound cost-based management is protecting margins from the impact of declining service sales. An additional restructuring of £20m reflects this dynamic. We expect a slow path to profit growth in 2010, and the “easy gains” in the stock are already made.”