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Best of the Best cash return

Competitions organiser Best of the Best (BOTB) is the best performer of the day on the back of better than forecast figures and a 66.7p a share return of capital via a tender offer. The share price jumped 86p to 480p, although that is still well below last year’s high of 3400p.

In the year to April 2022, the pre-tax profit fell from £14.1m, for what was an unusually strong year due to Covid restrictions, to £5.1m. To put this into perspective, in January the forecast 2021-22 pre-tax profit was cut from £6m to £4.5m, having been reduced from £16m the previous August. In May the forecast was edged up to £4.7m.

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Net cash was £10.8m at the end of April 2022 and there is a 6p a share final dividend on top of the tender offer. The total cash cost of these is £6.84m.

It appears Best of the Best could be returning to a steady growth path. There is a database of more than 1.8 million customers and management is seeking new ways to exploit this opportunity.

A pre-tax profit of £5.5m is forecast for 2022-23 and net cash is expected to be £9m at the end of April 2023. The shares are trading on nine times prospective earnings and the forecast yield is 1.4%.

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