Murgitroyd targets further deals after English acquisition

● Patent attorney firm eyes regions such as Asia – and sees ‘micro’ benefits of Brexit

Scotland’s only listed firm of patent and trademark attorneys has unveiled an acquisition south of the Border and is eyeing more globally as it posted a leap in interim revenue and profits – and hailed the knock-on benefits of Brexit.

Glasgow-based Murgitroyd has inked what it expects to be an “earnings-enhancing” acquisition of Chapman IP, a UK attorney practice based in the south of England, for about £6.6 million.

Additionally, the chief executive and finance director roles have been split, with Edward Murgitroyd becoming chief executive of Murgitroyd Group, after four years leading the operating business, and Keith Young continuing as finance director.

Edward Murgitroyd told The Scotsman that the deal marks a “huge indicator” of the group’s confidence.

He praised progress in the six months to 30 November, with revenue showing a yearon-year increase of 5 per cent to £22.67 million, and more than half now generated in the US.

Profit before income tax inched up to £1.7m from £1.67m, and the company proposed an interim dividend of 7p per share, up by 7.7 per cent.

Chairman and founder Ian Murgitroyd, father of Edward, commented: “I am pleased to report an increase in both revenue and profit before tax, which has allowed us again to propose an increased interim dividend, despite continuing macro-economic and political uncertainties.

“Reflecting the continuing importance to the group of its European patent and trademark attorney practice, the acquisition of Southampton-based Chapman IP complements Murgitroyd’s existing European network and client base. The acquisition is expected to be earningsenhancing for Murgitroyd in the first full financial year following completion.”

Murgitroyd also said that it would consider “appropriate” bolt-on deals that fit in with its long-term growth objectives.

“In that context, the board would look beyond the group’s current core business in Europe and the USA and consider opportunities in Asia and Australasia, although no such opportunities are under active consideration at the present time,” it noted.

Edward Murgitroyd said: “We view ourselves as a global partner for our clients and customers, so it only makes sense that we would look at those opportunities either by way of partnering or by way of doing it ourselves.”

The firm said Brexit had already prompted some upside in revenues, with clients now filing a trademark both in the UK and in Europe, having previously only filed in the EU, and it flagged potential further upside to activity levels and revenues.

Chief operating officer Gordon Stark said firms with a lower risk profile are mitigating that via pre-emptive steps. “If uncertainty is something that our clients want to mitigate then we can do that. We’re certainly seeing some ‘micro’ benefits of Brexit.”