On February 23, 2022, UK-based language service provider RWS released a statement to accompany its annual general meeting (AGM). RWS Chairman, Andrew Brode, said the current financial year (FY22) had begun well and the company is trading in line with expectations.
For reference, RWS generated revenues of GBP 694.5m (USD 940m) in its full-year 2021, which ended September 30, 2021. The company roughly doubled its revenues through the acquisition of major rival, SDL, in 2021, earning the second position on the 2022 LSPI leaderboard. Revenue growth on an organic constant currency (OCC) basis was a modest 4%.
In the AGM statement, Brode described RWS’ 2021 profit performance as “better than expected […] against the background of the Covid-19 pandemic.” Adjusted pre-tax profit increased 25% in 2021 — indicating synergies between RWS and SDL were aggressively leveraged.
Discussing the first few months of FY22, Brode said trading was reflective of “strong performances from our Language Services and Regulated Industries divisions which have offset a weaker performance in our IP Services division [representing 16% of group revenues in the last financial year].”
RWS’ Regulated Industries division also delivered standout results in 2021, outperforming the group with OCC-based growth of 8%; while Language Services was in line with the group and IP Services lagged at 2%.
Brode said 2022 will see RWS capitalize on its “expanded scale, footprint, and capabilities for clients, to drive sustainable organic growth from an efficient cost base.”
RWS also provided a company-compiled view of the latest analyst expectations for FY22. Current consensus pins expectations for FY22 revenues at GBP 761.2m (USD 1bn), with adjusted pre-tax profit of GBP 140m (USD 190.2m).
Delivering against the consensus would see revenues climb nearly 10% to cross the billion-dollar mark for the first time, and pre-tax profit increase by around 20% in 2022.
Shares in RWS were up slightly, by 1.4%, on the day the AGM statement was released. Shares have fallen around 24% from the start of January 2022; ending RWS’ bullish run in 2021 when shares climbed 20% during the year. The company’s current market capitalization stands at around USD 2.47bn.
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RWS will provide an update on its growth strategy, including plans for organic and acquisitive growth, among others, at the company’s Capital Markets Day on March 23, 2022.
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