PPHC Shares Move Lower as Firm Completes Acquisition of TrailRunner

Public Policy Holding Company's shares (LON: PPHC) have dipped 0.31% today, having earlier opened firmly green at 137.30p. The company has announced the successful acquisition of TrailRunner International LLC for a transaction value of $33 million, effective January 24th, and projected to enhance PPHC’s earnings starting from April 1.

TrailRunner International LLC, a company with a global presence through its offices in New York and London, includes the sports advisory service, TrailRunner Sports. Stewart Hall, CEO of PPHC, emphasised that the acquisition fortifies the company's market leadership in the United States and enhances its global strategic communications presence.

The founder of TrailRunner, Jim Wilkinson, also expressed optimism regarding PPHC's support, which he believes will significantly contribute to TrailRunner’s international growth. Established in 2016, TrailRunner reported unaudited net revenues of $25.2 million and a profit before tax of $4.5 million for the fiscal year ending December 31, 2024. Additionally, the company has seen its revenue grow by an 18% compound annual growth rate since 2018.

The acquisition's initial consideration involves issuing 2,966,138 new common shares, supplemented by cash from PPHC’s existing resources and a credit facility from Bank of America. Future additional payments will depend on TrailRunner's profit growth through the end of 2029.

For the year ending December 31, 2024, PPHC recorded a revenue increase of 10.8% to $149.6 million, alongside an underlying EBITDA rise of 3% to $36.1 million. In alignment with its growth strategy aimed at enhancing shareholder returns, PPHC plans to reduce its dividend. The management is also contemplating a potential US dual-listing to improve stock liquidity.

A detailed growth strategy is set to be presented by PPHC at the upcoming Capital Markets Event on January 30, 2025, at the London Stock Exchange.