After a difficult FY17, Management's turnaround is taking shape.
Companies: 1Spatial Plc
Geospatial data software company 1Spatial (LON: SPA) has announced its interim results for H1 18 which shows the turnaround in the Group's performance after a difficult FY17.
Revenues were up 2% to £12.1m and Adjusted EBITDA swung from a loss of £0.4m to a profit of £0.3m in the same period, while Losses After Tax were reduced to £1.4m from £2.1m in H1 17.
Three major deals were signed in the first half of FY18, including two "strategically important" US contracts as well as a three year deal with Northern Gas Networks, extendable for a further three years.
The report also noted a new Group CEO, CFO as well as a new Non-Executive Director have been appointed since the beginning of H2 18.
The stock was up 3.5% to 3.5p per share today off the back of the results.
Commenting on the turnaround, 1Spatial CEO Claire Milverton commented:
"The first half has shown considerable progress on our turnaround strategy. The focus on execution, and a greater engagement with our existing clients has seen an increase in revenues. Emphasis on growing our client base has also seen wins with a number of exciting new clients such as Northern Gas Networks and the Federal Highways Agency."
N+1 Singer released a note on the Group today, commenting on their stance on the stock:
"Our key financial forecasts in terms of revenue, adjusted EBITDA and cash are unchanged. Below the adjusted EBITDA line, other items such as depreciation, amortisation, share of associates loss, have also improved, delivering an improved PBT and EPS position than previously forecast."
The Group is currently valued at c. £26m, with Singer's outlook for SPA:
"We believe with continued execution, the shares should rerate closer to 2.0x EV/Sales, a reasonable rating for companies with a mix of software and IT services. This is equivalent to a 6.5p share price."
