No dividend until 2025: Is Mission Group still a recovery play?

UK advertising and marketing specialist Mission Group (TMG: 14p) has dropped an almighty bombshell on shareholders that prompted a 58 per cent share price collapse.

Less than four weeks ago, the directors were maintaining full-year guidance which underpinned house broker Canaccord Genuity’s pre-tax profit estimate of £7.9mn. Although revenue targets (8-9 per cent annual growth) should still be achieved, profitability will be materially worse than the board had been forecasting, so much so that headline pre-tax profit is now expected to be no more than £3.1mn. Around £1.2mn of the £4.8mn shortfall is attributed to costs relating to a business that will be classified as discontinued at the year-end.