Virtual offices create very real profits at Regus

Regus said it had benefitted from other companies’ realisation of flexible office spaces
SHARES in office outsourcing firm Regus jumped yesterday after the company reported an 86 per cent growth in underlying profits and double-digit revenue growth during the first half of the year.

Revenue grew 16.4 per cent to £937m, up from £804.7m for the same period the previous year, while underlying pre-tax profit was £57.8m for the first six months, marking an increase of 82 per cent on the previous year’s £31m.

In its report, Regus said it had benefit from companies’ increasing awareness of the benefits offered by flexible and convenient working at a time when it had been able to significantly reduce its overheads and had differentiated itself from its competitors through the provision of a wide network of WiFi hotspots.

“Regus delivered an excellent first half performance, giving us further confidence for the future,” said chief executive Mark Dixon.

“Our investments are delivering attractive returns, with returns on past investments improving and remaining well above our cost of capital and newer investments trading in line with our expectations.”

Dixon added that the flexible work market “continues to experience robust growth”, and said Regus remains “ideally placed to benefit from these trends by providing more customers with the right environment to succeed”.

“Current trading is in line with management expectations and the board remains confident in our prospects,” he said.

The firm increased the 2015 interim dividend by 12 per cent to 1.4p per share.”

Shares in Regus closed at 271.5p, up 8.99 per cent.