Buoyant DX is delivering the goods, UK
DX SERVICES, the business-to business mail company, has attracted investment from three top backers.
They have warmed to its potential for exploiting the opening up of the postal market to competition.
DX SERVICES, the business-to business mail company, has attracted investment from three top backers.
DX, which stands for document exchange, demerged from specialist recruitment firm Hays last November.
DX’s services include collection, delivery and sorting for 27,000 customers. The shares surged when they began trading on November 1.
The postal market is estimated to be worth about Pounds 5.8 billion and is expected to be fully open to competition by next January. DX, which has a stock market valuation of Pounds 285 million, won a seven-year postal licence in June. This frees it from relying on Royal Mail, unlike rivals such as Business Post.
The shares have risen from 283p to 375p but dropped to 331p after a poor trading statement on January 7.
containing bad news about the parcels division. The shares closed last week at 329p.
However, overall performance is in line with expectations and Citywire AAA-rated Old Mutual fund management duo Ashton Bradbury and Dan Nickols took the opportunity to buy into the dip in mid-January.
Bradbury’s UK Select Mid Cap fund holds 600,000 shares and Nickols’ UK Select Smaller Companies fund holds 687,000 shares.
DX is expected to make profits of Pounds 28.5 million before tax this year and Pounds 29.7 million next year. A 4p dividend is forecast for May.
