Midwich's market value soars past £500m after glowing update

Diss-based firm's bull run continues as it reveals that 2017 profits will come in "comfortably ahead" of expectations

Midwich's market valuation has breached the £500m threshold following a bullish trading update.

The print and audiovisual distributor's share price spiked to up to 650 pence this morning, up 17 per cent on last night's close, as it indicated that profits for 2017 would come in "comfortably ahead of its previous expectations.

This means its market cap has soared past £500m for the first time, potentially putting it onto the radar of a wider range of institutional investors (although at the time of publication this had dropped slightly to £490m).

When Midwich debuted on the Alternative Investment Market on 6 May 2016, its share price stood at 235 pence.

Since then, Midwich has made a spate of acquisitions, including Iberian Earpro, Dutch Gebroeders van Domburg and - most recently - UK-based Sound Technology

In a pre-close trading update for its year ended 31 December 2017, Midiwch said this morning that it had enjoyed "encouraging growth" across all its divisions in its second half, adding that all of its 2017 acquisitions performed on a par with or ahead of expectations.

The Diss-based distie, which now has 700 staff across the UK & Ireland, France, Germany, Iberia and Australasia, consequently expects 2017 revenues to rise 28 per cent to about £470m. This includes a three per cent bump from favourable exchange rate movements.

Midwich group managing director Stephen Fenby said: "2017 was another year of solid growth for Midwich, with strong performances from the Group's existing businesses and significant contributions from the acquisitions made through the year.

"We have been pleased with the integration of all the businesses we acquired and they are all trading in line or ahead of management's expectations. Through 2018, management will continue to explore cross-selling opportunities in the current portfolio while also evaluating the healthy pipeline of potential acquisitions both in the Group's existing markets and in new territories."

As a comparison, LSE-listed IT reseller Softcat's market cap recently burst through the £1bn mark following a bull run on its shares.