LONDON (ShareCast) - (ShareCast News) - Diversified group BGEO said second-quarter pre-tax profits soared to GEL 128.1m (£42m) from GEL 46.5m, aided by an increase in income from its banking and healthcare units.
Return on average equity was 23.4%, ahead of BGEO's 20% target. Revenue increased 49.4% to GEL 330.4M.

Profits at the Bank of Georgia operation rose 21.7% to GEL 87.3m while the healthcare business was up to GEL 37.5m from GEL 10.9m on a pre-tax basis.

BGEO said the Georgian economy gained traction in the first half of 2017, growing by 4.5% as external demand stabilized and government initiatives strengthened consumer demand and business confidence.

Analysts at Numis said Georgia continues to offer the strongest GDP growth prospects in Europe and saw the BGEO group return profile "being a multiple of that growth".

"We believe that the more Georgia evidences growth and democracy the higher the multiple the market will pay for its growth," Numis said in a note to clients.

"BGEO is a high margin, high return, high growth business that is valued at a single figure multiple of earnings. Georgia is a free market, pro-business (corporation tax is zero) democracy with Western levels of corruption."

Numis rated the shares a 'hold', with a target price of 3,548p. At 0920 BST BGEO shares were down 0.49% to 3,423p.

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