Regus profits fall but bright outlook ahead

SERVICED office provider Regus yesterday said full-year pre-tax profits fell 42 per cent as the recession took its toll on small business, and warned its outlook remained unclear.

Regus said the UK workspace picture remains hazy as it posted a fall in turnover from £1.077bn to £1.055bn with pre-tax profits of £86.9m compared with £149.2m in 2008. The company hiked its full-year dividend by 33 per cent to 2.4p.

Regus operates 150 serviced offices in the UK and 1,000 around the world. It plans to expand the number of workstations by up to 15 per cent, particularly across the US and Asia, with further expansion in countries including Oman, India and Senegal on the cards.

Chief executive Mark Dixon said: “In a challenging economic environment, Regus has proven resilient and flexible, delivering a sound performance and ending the year with a very healthy net cash position of £237m.”

While Dixon warned the outlook for the UK market remain particularly unclear, he added that Regus was “cautiously optimistic” about its other markets.

Investec analyst Wayne Gerry said: “We’re keeping a buy recommendation since you buy into a structural growth, and on top of that you have cyclical recovery. Regus is a clear market leader in what we consider to be a growth market.”