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In spite of the wider woes engulfing the media sector, international PR firm Next Fifteen is thriving in the robust technology and consumer PR consultancy markets.

In a bullish update covering the year to July – the numbers will be unveiled in October – Next Fifteen, whose clients include Facebook and MTV, flagged up a year of strong sales, profits and cash flows.

Next Fifteen’s knowledge of both traditional and social media, insists chief executive Tim Dyson, is helping it win clients that need to effectively focus their marketing budgets on online as well as offline media. New technology clients include Sybase and Autodesk, while the company has also strengthened links with the likes of Symantec and Ubisoft. Dyson insists investors can expect further sales growth this year, as well as margin expansion reflecting the benefits of scale and operational improvements.

Back in April, Next Fifteen cheered investors with news of record sales and profits for the half-year to January. Adjusted pre-tax profits increased by almost 10% to £3.1m, on sales up 3.3% to £30.4m, enabling a 12.5% increase in the interim dividend to 0.45p. Further highlights included growth in operating margins to 10.2% (2007: 10%), as well as net cash of £400,000 at the balance sheet date, following another period of strong cash conversion.

Forecasts for July 2008 suggest growth in pre-tax profits to £6.3m (2007: £4.47m), producing earnings of 8p and a 1.7p dividend. Though Next Fifteen’s shares have fallen in line with media sector peers, a price-to-earnings ratio of 5.6 for a profitable, growing, dividend-paying player looks way too ungenerous. Buy ahead of a rerating.

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Next Fifteen Communications	AIM	£17.04m	31.50p	0.50p
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