EQS Group - Further delays in German legislation

EQS has issued a year-end trading update, showing that it achieved its targets for number of new customers and for annually recurring revenues. However, the continuing delays to the full implementation of the whistleblowing legislation in the key German market mean that the group has missed its previously published targets for revenue and for EBITDA by €1.5m and €1.3m respectively. Guidance for FY23 now reflects an abundance of caution on the likely timing of the legislative stimulus, assuming t

EQS Group - German whistleblowing law now before year end

Progress of whistleblowing legislation through the German Bundestag has been slower than hoped, with transposition now likely in December, with a three-month implementation period. This delay means that management is now guiding to FY22e revenue growth of 25%, with EBITDA of €6.0m (was €6–10m). The EBITDA figure is in line with our forecast, despite the lower revenue (€3.2m below) reflecting a degree of flexibility on costs. The underlying boost from legislation coming into force across Europe r

EQS Group - German whistleblowing law set for end Q3

The long and frustrating wait for the EU directive on whistleblowing to be passed into law in Germany should finally end in late September and we would expect EQS to have a very busy final quarter. The delays mean management is now guiding to the lower end of the cited revenue range of €65–70m and EBITDA range of €6–10m and we have adjusted our model to reflect this. We have left our FY23 estimates for revenue and EBITDA unchanged for now and are publishing our first thoughts on FY24. H122 reven

EQS Group - Regulatory stimulus set for H222

EQS is in a strong position to build its client base as the EU whistleblowing directive comes into force across Europe. Delays in adoption of formal legislation are a frustration but do not detract from the strength of the underlying proposition. EQS retains its ambition to be the leading European cloud provider for global investor relations and corporate compliance solutions by 2025. The €45m raised in March will help fund the repayment of short-term bank and vendor loans during Q222. We see ma

EQS Group - Whistleblowing increasing in volume

EQS Group continues to increase in scale and ambition, extending its remit into sustainability technology alongside its existing cloud-based offerings in corporate governance and investor relations. The recent capital raise of €45m gross at €33.00 per share puts the group on a more solid financial footing as it pursues the major opportunity in whistleblowing solutions and gives Gerlin NV a 6.2% stake. Management has reiterated its medium-term target for FY25 of group revenues of €130m and EBITDA

EQS Group - New customer growth momentum

EQS Group has updated on FY21 revenues, at €50.4m against our forecast of €49.4m. There is no update on FY21 EBITDA, but our numbers imply a very modest margin in Q4, given the extent of additional spend on driving sales. This effort is delivering results, with 425 new customers recruited in Q421 alone. Delays in Europe enacting whistleblowing regulation into national legislation have not had the impact feared in the short term and progress on this front should provide a healthy backdrop for the

EQS Group - Business Keeper a keeper

EQS Group’s Q3 figures show the boost given to its whistleblowing offering by the June acquisition of Business Keeper, lifting the total number of whistleblowing customers to around 1,500. Implementation of the EU Directive into national legislations is delayed in a number of territories, but the direction of travel is set and the timetable slippage should only be one or two quarters. The additional sales and marketing costs were already factored into our estimates (in line with management guida

EQS Group - Grasping the whistleblowing opportunity

EQS has built a strong platform business in corporate compliance and investor relations, with growing recurring revenues. It is well positioned to capitalise on the time-limited expansion opportunity presented by the European Whistleblowing Directive, which has an implementation deadline of December 2021. Achieving a strong foothold here will be key for driving greater SaaS customer acquisition, underpinning management’s ambitious medium-term revenue and margin guidance.

EQS Group - Whistleblowing deadline fast approaching

EQS Group’s H121 results were strong, showing robust increases in revenue and its customer base. Following its Q321 acquisition of Business Keeper, EQS is now well positioned to capitalise on the time-limited opportunity offered by the European Whistleblowing Directive. Achieving a strong foothold here will be key for driving SaaS customer acquisition, underpinning management’s ambitious short- and medium- term guidance.

EQS Group - Whistleblowing deadline fast approaching

EQS Group’s H121 results were strong, showing robust increases in revenue and its customer base. Following its acquisition of Business Keeper in Q321, EQS is now well positioned to capitalise on the time-limited opportunity presented by the European Whistleblowing Directive. Achieving a strong foothold here will be key for driving SaaS customer acquisition, underpinning management’s ambitious short- and medium- term guidance.

EQS Group - Business Keeper deal

The intended acquisition of Business Keeper consolidates EQS’s position as market leader in whistleblowing provision in Europe ahead of the full implementation of the regulation. It brings with it around 300 customers, extending the pipeline of warm leads for other group services, as well as additional trained and operational sales resource for the short-term push. The €97m purchase price is being met from a mix of cash, debt and equity (up to 0.59m new shares), limiting dilution. The FY25 reven

EQS Group - FY21 focus on whistleblowing

EQS is making good progress on building a substantial presence in both corporate compliance and investor relations, growing its SaaS and annual recurring revenue streams. With a platform approach that allows for cross- and up-selling, this is a scalable business model in growing markets, driven by digitisation and regulation. The implementation of whistleblowing regulation in the EU during 2021 gives a clear opportunity for the group to extend its client base. The cost of grasping that opening i

EQS Group - Ramping up whistleblowing sales

EQS had a clear benefit in FY20 from the demand for virtual corporate communications but the key to future growth is in the corporate compliance segment. Its cloud-based products are set to be the core growth driver over the medium term. With the imminent implementation of European whistleblowing regulation, there is a short-term opportunity to gain new clients, with the potential to expand accounts after. To make the most of this, the group is investing an additional €5.6m in sales and marketin

EQS Group - Ramping up whistleblowing sales

EQS had a clear benefit in FY20 from the demand for virtual corporate communications but the key to future growth is in the corporate compliance segment. Its cloud-based products are set to be the core growth driver over the medium term. With the imminent implementation of European whistleblowing regulation, there is a short-term opportunity to gain new clients, with the potential to expand accounts after. To make the most of this, the group is investing an additional €5.6m in sales and marketin

EQS Group - Complying with growth ambitions

EQS Group’s preliminary figures for FY20 show revenue growth of 18%, adjusted for last year’s sale of ARIVA. This is broadly in line with our estimates, with EBITDA of €4.8m (Edison forecast €4.9m), near double the prior year as the increasing scale of the business delivers efficiencies. FY21 should see good demand for compliance solutions as the whistleblowing regulations come into force, and the group is opening new offices in Milan and Madrid to help capture greater share.

Hybridan Small Cap Feast - 21 Feb 23

21 February 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment objec

New Forecasts: breaking through

With FY22 in line and no changes to our existing FY23 forecasts, our focus is on the introduction of new forecasts for FY24 and FY25. We model Clareti recurring revenue growth of 17% and 18% resp. With Clareti having broken through to positive cash EBITDA for the first time in its history in FY22, we expect operating leverage to drive significant margin expansion over the next three years and beyond (Gresham guides to 40% of ARR dropping through to cash EBITDA). We model cash EBITDA margins of 1

Hybridan Small Cap Feast - 06 Mar 23

6 March 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment objective

Morning Note – 7 March 2023

Nothing but NET

Hybridan Small Cap Feast 08/03/22

What’s cooking in the IPO kitchen?** Fadel Partners, a developer of cloud based brand compliance and rights and royalty management software, working with some of the world's leading licensors and licensees across media, entertainment, publishing, consumer brands and hi-tech/gaming companies intends to join the AIM market. FADEL has two solutions, being IPM Suite and Brand Vision. Expected Admission date is late March 2023. Onward Opportunities Limited intends to join the AIM market. The Company'

Accretive bolt-on M&A

Microlise is making its first deployment of funds raised at IPO with the £2.1m cash acquisition of UK Transportation Management System vendor Vita Software. Vita offers complementary upstream SaaS software with strengths in the area of order management, which feeds into Microlises best-in-class journey execution solutions. Vita has a long history of uninterrupted profits and cash growth and is being acquired on approximately 4x revenues and 8x EBITDA. As such the acquisition will be immediately

SHORE CAPITAL - FDM (FDM) - House Stock at 854p - Impressive again, and planning ahead

Hybridan Small Cap Feast - 27 Feb 23

27 February 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment objec

Hybridan Small Cap Feast - 07 Mar 23

7 March 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment objective

Hybridan Small Cap Feast - 09 Mar 23

9 March 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment objective

Raising the sails

Morning Note – 26 January 2023

Fonix Mobile - Strong H1 23 with +12% gross profit and +18% DPS growth

Fonix has announced strong H1 23 results, with +12% gross profit growth, +12% adjusted EBITDA growth, and underlying net cash of £8.4m due to EFCF of £5.1m. Commercial customers have driven mobile payments and mobile messaging growth of +13% and +18%, and gross profit as a % of TPV has increased to 5.7% from 5.1% in H1 22 due to lower charity volumes. The 3 March ITV announcement makes Fonix the de facto SMS interactive services partner for broadcasters in the UK, and it is focused on becoming t

Hybridan Small Cap Feast - 01 Mar 23

01 March 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment objectiv