The FTSE 250 is composed of companies with potentially exciting growth prospects. I’ve found it useful to search the index for firms to add to my portfolio that’s geared for long-term growth. I think I’ve found two interesting businesses that could be great to add to my investments with a spare £1,000. Why am I attracted to these companies? Let’s take a closer look.
Strong resilience
Beazley (LSE:BEZ) is a firm specialising in non-life insurance. It operates globally and its segments include cyber, political, and marine risk. It currently trades at 480.6p.
In 2021, pre-tax profit was $369.2m. This was a sizeable swing from a pre-tax loss of $50.4m in 2020, during the worst of the pandemic.
A reason for the increased profitability was higher demand in the cyber segment.
Furthermore, for the three months to 31 March, gross premiums rose 27% to over $1.2bn. This was an increase from $971m year-on-year.
The business also reported an estimate of $50m income from reinsurance relating to the conflict between Russia and Ukraine, which excludes aviation.
However, the company registered a $92m investment loss, down from a gain of $27m for the same period in 2021. I would like to see this improve in the future.
Despite this, earnings-per-share (EPS) has grown from ¢25 to ¢50.9. By my calculations, this is a compound annual EPS growth rate of 15.3%.
A FTSE 250 miner
Centamin (LSE:CEY) is a mineral exploration and development business operating in Australia and Africa. It currently trades at 85.5p.
The company’s 2021 gold production figure was in line with guidance, with a final reported total of 415,000 ounces. This was at the mid-point of previous estimates.
Investment bank Berenberg also recently increased its price target from 104p to 112p, because it believes there could be value in the firm’s Egyptian mining projects.
Despite this, pre-tax profit in 2021 halved to £153.6m from £315m the previous year. Revenue also fell by around 12%.
Some of this financial decline is explained by a $35.2m impairment relating to exploration activities in Burkina Faso.
The business is also at risk from inflation, as wages and cost of operations rise. There’s a possibility that this may eat into future profit margins.
However, Centamin is currently benefiting from historically high gold prices. It’s currently trading at $1,860 per ounce. Given the company’s rate of gold production, these conditions could be good news for revenue going forward.
Overall, these two firms have the potential to produce good results in the future. Beazley has shown strong resilience following the pandemic, while Centamin could continue to benefit from high metal prices. While there are risks involved with investment in either business, I think the potential rewards could be great. I will be splitting my £1,000 equally and buying shares in both companies soon.
