Gateley Holdings PLC on Wednesday said interim profit and revenue were up, allowing it to pay an increased dividend, while it said it looks forward to 2023 with cautious optimism.

The Birmingham, England-based legal and professional services group said pretax profit in the six months that ended October 31 was £8.0 million, up 9.6% from £7.3 million a year earlier on revenue that rose 22% to £76.1 million from £62.3 million.

Gateley declared an interim dividend of 3.3 pence per share, up 10% from 3.0p a year earlier.

Shares in Gateley were up 1.1% to 191.00p each in London on Wednesday morning.

Gateley noted that group organic revenue growth of 9.8% across the half-year period slowed from 23% a year before, as legal services revenue growth slowed to 8.2% from 22%. However, revenue from consultancy services more than doubled to £18.2 million from £8.9 million, of which organic revenue growth was 20%

Adjusted underlying profit margin slippped to under 13% from under 14%, as some operating costs that had not been required during the Covid-19 pandemic returned.

Gateley remained positive about its growth strategy, citing a strong balance sheet and ‘significant headroom’ in its revolving credit facility, although its ongoing mergers & acquisitions strategy meant net cash on October 31 fell to £1.1 million from £8.8 million a year earlier.

As of October 31, Gateley has utilised £6.8 million of its £30 million facility, up from none a year prior.

‘The group has delivered a strong performance in [the first half of financial] 2023 against the backdrop of an uncertain macro environment, with activity levels, revenue and profitability advancing once again,’ said Finance Director Neil Smith.

Looking ahead, Chief Executive Officer Rod Waldie added: ‘We look forward to 2023 with a degree of cautious confidence.

‘During the period, we saw political and economic instability manifesting in uncertainty and temporary paralysis in a number of sectors. This is an ongoing situation and the economy is approaching a fork in the road where in all likelihood there is a wide range of possible outcomes across different sectors.

‘Whilst in recent weeks we have begun to see transactional activity levels reduce slightly from the unprecedented highs of [financial] 2022 and [the first half of financial] 2023, we are also seeing revenues beginning to pivot towards some of our more counter-cyclical lines. As such the group is operating as it is designed to do, which gives us confidence that, notwithstanding prevailing economic winds, the group will extend its decades-long track record of uninterrupted growth.’

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