MIDAS SHARE TIPS: Tailor made revenue from trend advisers Elixirr

Catwalk client: Elixirr clients include LVMH, home of Louis Vuitton

Catwalk consumer: Elixirr shoppers embrace LVMH, house of Louis Vuitton

Management consultants have a nasty title. Accused of charging 1000’s and delivering little or no, they’re related to among the worst excesses of the company world. 

Elixirr chief govt Stephen Newton is aware of the business’s pitfalls solely too effectively. A former managing companion at consulting big Accenture, he left in 2009 to begin one thing completely different, an advisory agency that offered sensible, hands-on assist for firms.

The technique is working. Having grown steadily as a privately owned enterprise, Elixirr listed on the junior AIM market in July 2020, one among a handful of companies to drift at that troubled time. It can be one of the vital profitable listings of latest years, becoming a member of the market at £2.17, since when it has greater than doubled to £5.50.

The hovering worth displays robust progress in gross sales and income and there needs to be loads extra to come back. Companies spend round £200 billion a 12 months on administration consultants and the business is rising by 10 to 12 per cent yearly world wide. 

With a inventory market valuation of £260 million, Elixirr is a minnow by comparability with giants reminiscent of Accenture and McKinsey, however the group has elevated gross sales by a median of greater than 30 per cent a 12 months over the previous decade and is predicted to develop quicker than the remainder of the marketplace for a while to come back.

Industry leaders are sometimes criticised for promoting clients no matter they’ve on the shelf, no matter whether or not it really suits the invoice. Newton and his crew delight themselves on providing a extra bespoke method, primarily based on sensible recommendation, tailor-made to clients’ particular person necessities.

The group has additionally developed shut relationships with cutting-edge know-how entrepreneurs in Silicon Valley, New York, London, Tel Aviv, Cape Town and Sydney. When companies come to Newton with issues, due to this fact, the community could be referred to as upon for intelligent concepts above and past regular recommendation.

Sometimes, Elixirr distils the community’s greatest recommendations for its clients. Other occasions, companies meet members of the community instantly. Whatever the method, the emphasis is on initiatives that may make a tangible distinction, fairly than airy-fairy notions that sound good on paper however haven’t any foundation in the true world.

Newton can be eager to make his workers really feel and act as in the event that they personal the enterprise. To that finish, workers are given share choices and entry to a beneficiant share scheme, below which Elixirr matches any inventory that workers purchase, in impact doubling the variety of shares they maintain.

Bespoke recommendation, technological data and dedicated staff have created a potent cocktail. Surveys point out that many companies charge Elixirr extra extremely than a lot bigger rivals and buyer numbers are on the rise, together with high-profile names reminiscent of Tesla, Burger King, HSBC and luxurious items group LVMH, house to trend model Louis Vuitton.

Elixirr generated revenues of £30 million and income of £5.8 million in 2020, its first 12 months as a public firm.

Figures for 2023 will likely be unveiled in April however a latest buying and selling assertion confirmed that gross sales will quantity to virtually £90 million, with brokers forecasting income of round £24 million.

Continued progress is predicted, with revenues of £108 million pencilled in for this 12 months and £119 million subsequent. Profits progress needs to be equally sturdy, with earnings climbing to £28.5 million in 2024 and greater than £31 million subsequent. The group has all the time been dedicated to paying dividends however, in an indication of confidence and maturity, Newton just lately introduced a transfer from annual to twice-yearly funds. A complete dividend of 12.3p is now anticipated for 2023, rising to 14p for 2024.

Midas verdict: Some administration consultants have had a tricky time just lately, pressured to put off workers and streamline prices in response to tough financial circumstances. Elixirr is shifting in the other way, including new clients, increasing its workforce and buying boutique operators that complement the enterprise.

Newton and his crew are decided to proceed in that vein, setting their sights on a £1 billion inventory market valuation over the subsequent few years. Progress has been encouraging thus far and, with 28 per cent of the shares, Newton is definitely motivated to ship outcomes. At £5.50, the shares are a purchase.

Traded on: AIM Ticker: ELIX Contact: or 020 7220 5410