Basically primary business provides a billing service to medical professionals in the UK.

Overview

- Steady organic revenue growth (~10% p.a)

- Dip in profits in last couple of years attributiable to pound depreciation and restructuring costs which seem to have been actually "one off" --> now returning to profit growth

- Now leveraging exposure to doctor's to sell other services e.g. insurance

- Good history of returning excess cash to shareholders and steady share count

- No debt

- 2mil in bank

Trading at foward PE of 11-14 on company projections representing good value IMHO

Very healthy H1 report

With IT investments in place 24% increase in revenue saw a significant chunk falling through to the bottom line leading to a 100% increase in net profit after tax. In keeping with a trend of returning excess cash to shareholders they have increased the intrim dividend 80% to 4.5 cents (unfranked) and also authorised a share buyback of up to 10% of the register.

Profit appears to be trending toward the upper end of the 1.4 - 1.7m guided for the full year.

Cash on hand of 2m. No Debt.

Commentary generally positive.

Operational efficencies sound like they are improving margins.

Have a look at the profit growth and revenue growth graphs over the last 5 years (looks like operating leverage to me).

Growing billing book organically by client referrals even during lockdown

Brief mention of medical indemnity joint venture.

No guidance given.

Stated: Subject to results and any capital management strategies and/or any acquisitions and investments - intention to maximise dividend payment.

Thoughts: ICS is a well run business with ongoing growth runway at an undemanding valuation with a good history of returning excess cash to shareholders. It survived the worst of COVID with flying colours despite being in the direct firing line. I remain a happy shareholder.

ICS announced that it has entered into an agreement to sell its operating business MBC for $22 million. This means if it passes it will leave ICS with liquid assets of roughly $2.26 per share.

It is interesting that there was essentially no premium paid for the business compared the current share price. Having invested in this business believing that it was "undervalued" it seems a raw deal for shareholders. 

Possible outcomes from here:

- Sale is passed (likely) --> cash returned to shareholders with some friction for probably ~$2.20 or ~5% return from here bit less after tax as not all my buys were >1yr ago

- Sale is rejected (unlikely) --> Higher offer is proffered say $2.50 /share equivilent ~ 15% return

- Sale is rejected (unlikely) --> Continue to hold business I was happy holding previously

I could just sell now if I felt there were better opportunities.

If there is a random sell off making the above numbers more attractive I could buy more.

Overall I think I will hold for now as the downside seems pretty limited can't say my conviction is particularly high.