Connect has released a confident set of prelims, comfortably ahead of expectations at the PBT level as a result of a strong initial contribution from Tuffnells and continuing progress in the traditional Smiths News business. The outlook is confident in most areas. In News and Media, new services such as Pass my Parcel as expected to offset the future decline in News distribution revenues. In Books, after recent difficulties, management aims to double profitability over the next three years. Education & Care seeks to continue to outperform its markets, and Parcel Freight is identified as the main driver of near term growth. Current trading is said to be in line with expectations as positive trading offsets the impact of National Living Wage. We remain at BUY.
