Office2Office - Initiation of Coverage. Strong contract wins and growth opportunities

	Office2Office Initiation of Coverage - Strong contract wins and growth opportunities office2office (o2o) is a leading supplier of office products and services in the UK. Major Contract Wins – The group has won a number of important contracts over the past 18 months that could generate revenues of over £60 million per annum when fully implemented. Significant Growth Opportunities – We believe o2o has significant scope for revenue growth, both by expanding existing contracts and through new contract wins. Impressive Dividend – o2o currently offers a dividend yield of 7.8%, which is supported by a strong historical free cash flow. We recommend the shares as buy at 146p with a 219p target price. Click to Download Full Report Table: Financial overview Year to 31st Dec. 2010A 2011A 2012E 2013E Revenue (£m) 207.6 193.5 228.3 240.2 EBITDA1 (£m) 13.0 10.8 11.5 12.4 PBT (£m) 4.6 4.3 4.0 7.2 Basic EPS (p) 12.0 12.0 8.2 14.7 Dividend (p) 11.4 11.4 11.4 11.4 Yield (%) 7.8 7.8 7.8 7.8 Source: GECR and company Notes: 1 Adjusted for exceptional items and non-cash charges. Buy Target price 219p Key data Share Price 146p 52 week high/low 166.50p / 124.75p Primary exchange LSE EPIC OFF Shares in issue 36.31 m Market Cap £53.01m Sector Support Services Valuation EV / EBITDA 10.1 P/E 12.3 NAV £20.6m Affiliations: None Important: All disclaimer information can be found on the last page of the document

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