LONDON -- Outsourcing company MITIE Group (LSE: MTO.L) has a good track record of steady financial performance, and it has made a decent start to its latest financial year. The company is also optimistic about the future, partly thanks to its latest big contract with Lloyds Banking Group (LSE: LLOY.L).
The five-year deal with Lloyds started on Aug. 1 and should contribute 775 million pounds in revenue over the period of the contract. In the context of MITIE's current annual turnover of 2 billion, that's a significant amount.
Other recent contract wins have included the Royal Bank of Scotland, the Scottish Government, and the City of London Corporation, although these are much smaller deals of around 30 million pounds apiece.
MITIE said it was "well placed to achieve good levels of organic growth in the current financial year, in line with management's expectations," and that as of June 30, 87% of budgeted revenue for this financial year had already been secured.
Two small acquisitions were also made in the last few months, in line with MITIE's long-running strategy of making small bolt-on purchases rather than larger, more transformational deals.
MITIE shares were broadly unchanged in early trading at 286 pence. This values the company at 1 billion pounds, where it trades on a forward price-to-earnings ratio of just less than 12 times and offers a prospective dividend yield of 3.6%.
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