Published on 19th August 2012
Personal Group pays dividends every quarter, has grown consistently since it was founded 28 years ago and provides a service to lower-income workers nationwide. The shares yield more than five per cent and the firm has appointed a new chief executive, Mark Scanlon, with a brief to expand the business. So far, so encouraging.Personal Group’s range of products offers companies a handy way of making employees feel wanted, even when pay increases are low or non-existent. Perks help attract new workers and retain staff and more businesses than ever are looking at these types of benefits in today’s tough environment. Personal Group offers benefits primarily to blue-collar employees such as postal workers, train drivers and couriers. There are three core products – cash plans, which offer policyholders extra money if they have an extended stay in hospital, convalescence plans, to be used on return from hospital, and death benefits, which pay out lump sums to close family in the event of a worker’s death. Next month, Scanlon will unveil his strategy. The focus will be on growth, but Personal Group’s core offering will be unchanged. Customers will continue to receive attentive service and shareholders will still receive healthy dividends. Analysts expect profits to be slightly lower in 2012, reflecting investment in the future, but Personal Group is highly cash-generative so the dividend on shares now trading at 346˝p is forecast to rise from 17.4p to 17.8p, payable in four equal instalments next year. Midas is of the following opinion: “Personal Group has grown steadily since the 1980s and is set to increase its firepower over the next few years. The shares offer an attractive blend of income and excitement. Buy.”