Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on Artilium. We currently have 25 research reports from 3 professional analysts.
Anexo -specialist integrated credit hire and legal services group. Offer TBA. Due 19 June. i-nexus—develops and provides strategy execution software to assist global enterprises in effective execution of their strategic plans and initiatives looking to jon AIM. Offer TBC, expected 19 June Yellow Cake will use its expertise to generate value through the ownership of physical U3O8 (Uranium) together with a range of activities and opportunities connected with owning physical U3O8. Acquiring supply contract for up to $170m. Offer TBA. Tekmar— technology provider of protection systems for subsea cable, umbilical and flexible pipes and offshore engineering services—Offshore wind farms and Oil & Gas. Revenue of £21.9m and Adjusted EBITDA of £4.9m Offer TBA Knights Group— UK regional legal and professional services businesses. FYApr18 rev £34.9 million and adjusted operating profit was £6.8 million excluding Turner Parkinson (acquiring on IPO). Offer TBA Aquis Exchange—a founder-led, pan-European Multilateral Trading Facility and exchange and regulatory technology developer and service provider is looking to join AIM. Offer TBC, expected 20 June. TransGlobe Energy Corporation—an independent international upstream oil and gas company with headquarters in Calgary, Canada is looking to join AIM. No Capital to be raised, market cap of £131m. Expected 29 June Block Energy— UK based oil exploration and production company whose main country of operation is the Republic of Georgia. Raising £5m at 4p. Mkt cap £10.3m. Due 11 June. Strongbow Exploration (TSX:SBW) intends to dual list on AIM. Holds rights to the South Crofty underground tin mine, a former producing tin mine located in the towns of Pool and Camborne, Cornwall . The project is estimated to require the Company to raise £25 million over the next 18 months to progress to a production decision. Offer TBS. Due June. Yew Grove REIT—newly formed Company will pursue its investment objective by investing in a diversified portfolio of Irish commercial property. Raising €75m at €1. Due 8 June
Companies: DDDD JOUL ZIN IHC KWG ARTA WCH TSL ATMA
Artilium (ARTA): Corp Excellent interims lift FY expectations | Destiny Pharma (DEST): Corp Resisting resistance: funded to Phase IIb inflection point | Elecosoft (ELCO): Corp FY 2017 sees notable earnings and cash flow | eServGlobal (ESG): Corp Mastercard works with HomeSend | Horizonte Minerals (HZM): Corp 2017 annual results | K3 Business Technology (KBT): Corp Clarity and cash | Orchard Funding Group (ORCH): Corp 22% progress | Quartix (QTX): Corp AGM hears of insurance pressure | SCISYS (SSY): Corp Space delivers a strong year | STM (STM): Corp A watershed year
Companies: ARTA DEST ELCO HZM KBT ORCH QTX STM SSY WJA
The Belgium-based provider of telecommunication software and solutions is making significant progress. It has delivered an excellent H1 performance, and although the group plans additional investment in H2, we lift our FY 2018 forecasts and target price in response. Last year’s acquisitions of Wbase and Digiweb have been fully integrated, with Livecom brought into Comsys, to form a cohesive international business. Further expansion is being seen in Germany. This has been augmented with an experienced and capable CFO and a key partnership with NYSE company Pareteum to accelerate growth with initial success in China.
K3 Capital* (K3C): The winner takes it all (CORP) | InnovaDerma* (IDP): H1 trading update (CORP) | Savannah Resources* (SAV): Mining Lease applications submitted for Mutamba (CORP) | Artilium* (ARTA): Getting its message across (CORP)
Companies: K3C IDP SAV ARTA
Artilium is significantly strengthening its offering and increasing the size of its business with the acquisition of a German enterprise messaging company. In contrast to a recent spate of smaller in-fill additions, this is a major purchase heralding a step-change in scale: an uplift in earnings prospects and a shift in structure, focusing the offering on either Telco or Enterprise clients. Artilium is paying €3.5m (€2m in cash and €1.5m in options) for IDM, a profitable cloud communication provider operating a proprietary platform for worldwide enterprise-level SMS distribution. This will fit nicely into the existing array of services with excellent prospects for synergies. The nil-cost options for 11.1m shares that will vest in January 2020 and the cash element is part funded by a €1.25m placing of 11.5m shares (3.3% of the current issue) at 9.58p. A further 1.1m shares have been issued to advisors in lieu of cash. We upgrade our forecasts and TP in response.
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This quarter we use finnCap’s Slide Rule to provide both top-down and bottom-up analysis of the UK’s Technology and Telecoms sectors. Our findings are very reassuring: the Tech sector scores the best (across all sectors) when considering Growth and Quality – Taptica*, Frontier Developments* and dotDigital* in particular stand out on these metrics. Given these attractive characteristics and growth prospects, the Tech sector is unsurprisingly one of the most expensive – currently trading at 17.2x FY1 EV/EBIT and 23.8x FY1 P/E, versus 15.0x and 18.5x respectively for the wider market. Despite valuations appearing high, we believe there are value opportunities. For example, Proactis* features in finnCap’s QVGM+ portfolio (ranked 17/462) – the company offers attractive organic and inorganic growth, with earnings forecast to grow by 26% CAGR over the next two years, but despite this, only trades on 15x FY1 earnings and offers 8% FCF yield in FY2.
Companies: 7DIG ALT AMO ARTA BOTB BLTG CTP CITY D4T4 DTC DOTD ELCO FDEV GBG IDEA IDOX IGP IOM KBT KCOM KWS LRM MAI MMX NASA NET PHD QTX QXT RCN 932 SEE SIM SPE SRT STR TRMR TAX TEP TPOP TRAK UNG VIP ZOO CYAN ONEV SSY ABAL WJA
We re-initiate coverage with the FY 2017 results as the group delivers solid growth in both revenue and EBITDA. Underlying that financial progress, it is making good operational and technical progress in constructing a truly global and innovative cloud-based telecoms software provider. A number of acquisitions and partnerships forged over the past few years have left Artilium well positioned as an enabler to take advantage of the ongoing growth in the global MVNO market. It has a comprehensive range of products to suit all the needs of communications services providers around the world, from developing regions to developed regions. Being cloud-based, they are flexible and do not require heavy upfront investment. Artilium's ‘pay-as-you-grow’ business model tailors them even more for newly launched MVNOs, with additional platforms expected to be sold in Africa and Latin America in particular.
The comms software company is expanding from its established UK and Belgian operations with a new office in Bocholt.
Water Intelligence* (WATR): Building a market leader (BUY) | Mortice* (MORT): Contract wins (CORP) |Avacta* (AVCT): Momentum building… Two reagent licences (CORP) | Revolution Bars (RBG): Forecast downgrades (BUY) | Shanta Gold (SHG): Completion of US$10.0m equipment financing (BUY) | Artilium* (ARTA): Small customer-base acquisition (CORP)
Companies: WATR MORT AVCT RBG SHG ARTA
Eddie Stobart Logistics— Schedule 1. Admission expected 25 April but capital raising details TBC. ADES International Holding— Intends to join the Standard List in May raising up to $170m plus a vendor sale. Provider of offshore and onshore oil and gas drilling and production services in the Middle East and Africa. Admission expected in May. Tufton Oceanic Assets– Offer extended to 9 May to enable investors to complete further due diligence.
Companies: PAF OMIP ARTA MAYA NTQ TCN CGH RTHM HYR
D4T4 Solutions* (D4T4): Changing mix sees earnings upgrade (CORP) | Artilium* (ARTA): Web developments (CORP)
Companies: D4T4 Solutions Artilium
Enterprise-focused niche applications of tech illustrate how, while trends appear to be fluctuating away from the current poster children of fintech and the Internet of Things, in fact these developments are refining appropriate application of existing technologies.
Companies: 7DIG AMO ARTA BVC BOTB CTP CITY D4T4 DTC DOTD ELCO FDSA FDEV GBG IDEA IDOX IGP IOM KBT KCOM KWS LRM MAI MMX NASA NET PHD QTX QXT RCN 932 SEE SIM SPE TAX TEP TPOP TRAK UNG VIP ZOO ONEV SSY ABAL WJA
Lighthouse Group* (LGT): Middle Britain growth (CORP) | Utilitywise* (UTW): Double-digit sales growth (CORP) | Trakm8* (TRAK): Earnings expectations cut again (CORP) | dotDigital* (DOTC): Myriad growth opportunities (CORP) | Artilium* (ARTA): Five-year Telenet deal secured and prepaid (CORP) | Netcall* (NET): Cloud investment pays off (CORP)
Companies: LGT UTW TRAK DOTD ARTA NET
Research Tree provides access to ongoing research coverage, media content and regulatory news on Artilium. We currently have 25 research reports from 3 professional analysts.
|01Oct18 15:50||RNS||Scheme Effective|
|01Oct18 07:30||RNS||Suspension - Artilium plc|
|28Sep18 16:00||RNS||Court sanction of Scheme of Arrangement|
|25Sep18 10:30||RNS||Rule 2.9 Announcement (Pareteum Corporation)|
|18Sep18 09:30||RNS||Rule 2.9 Announcement (Pareteum Corporation)|
|14Sep18 13:30||RNS||Result of Shareholder Meetings|
|13Sep18 16:15||RNS||Pareteum Stockholder Meeting|
Prelims reveal continued progress, particularly within Vicon, where sales grew an impressive 16% y/y, in turn driven by success within both new and existing verticals and so consistent with strategic objectives. Relative to forecasts, sales of £35.4m (+12% y/y) are in line and so too is adj. PBT of £5.5m, following continued investment and also IFRS 15 adoption. We leave forecasts essentially unchanged, believing the drivers for both divisions remain firmly intact and indeed reaffirmed, following an excellent FY’19, particularly in Engineering and ‘Adjacent Verticals’ within Vicon. On valuation, we continue to apply a SOTP methodology, reflecting both Vicon’s industry leading position and cash generative qualities and further, Yotta’s growing ARR in our fair value calculation. This arrives at 108p, implying some 20% upside.
Companies: Oxford Metrics
Pelatro has won a landmark contract with one of the biggest telcos in the world; a major global operator and household name – an outstanding achievement for a small newcomer in the market. After careful deliberation, it has been taken as another recurring revenue/gain-share deal (a fourth this year) rather than a large upfront licence. As Pelatro matures and feels more established, management can afford to take a longer-term view, sacrificing short-term growth and profit for the stability of recurring, incremental revenue streams. A likely $7m of upfront licence has now been foregone in these deals this year and thus FY 2019 revenue guidance is cut to $6.5m (still up 6% YoY). The impact of this pivot to much higher quality revenue should not hide remarkable performance this year. For comparison, had these been taken as licences, FY 2019 sales would have been $13.5m; 28% ahead of our $10.5m forecast set mid-2018, and 121% YoY growth on a comparable basis. That follows 161% and 95% YoY growth in FY 2017 and 2018 respectively. This breakthrough win comes on top of consistently strong sales growth and the increasing quality of earnings, and we reiterate our 125p TP.
Following continued delays of a Brexit agreement, few sectors within the UK market have remained attractive to investors despite low valuations. One sector which has continued to outperform despite the political drama has been the UK video gaming sector (henceforth UK gaming), which we are fans of. We believe a combination of sector-leading growth, strong cash conversion and timely cyclical positioning support our positive view on the UK video gaming sector.
Companies: ABBY AMS ANX ARS ATYM AVON BLVN PIER BUR CGS CAML CDM CSRT TIDE CYAN DTG DEMG ELM EMR FPO FDEV GTLY GENL GHH GRI GEEC GKP HMI HAYD HEAD HILS HTG HUR IBPO IOG INDI JHD JOG KAPE KEYS KWS KCT KGH LAM LIT LOK MACF MANO MOD OXIG PCA PANR APP SRE PHC PMO RBW RMM RBGP REDD RSW RNO ROR SUS SCPA SEN SHG SOLG SOM SUMO TM17 INCE TWD TRAK TRI VNET VTC ZOO ZTF
Bigblu’s trading statement confirmed an H2 performance in line with expectations. Actions to cleanse the customer base should yield operational benefits over time and the above consensus year-end net debt figure (£14m vs £9m) primarily reflected a Brexit-driven inventory build that should reverse in the next few months. Bigblu remains confident in FY20 consensus (see below), which implies an acceleration in revenue growth.
Companies: Bigblu Broadband
Blackbird plc* (BIRD.L, 35p/£30.7m) | CAP-XX Ltd* (CPX.L, 3.7p/£12.0m) | Shearwater plc (SWG.L, 242p/£53.5m)
Companies: BIRD CPX SWG
Interims are in line with the October trading update and unchanged forecasts, with revenue growth +5% to £4.4m, and £5.2m gross cash. The reduction in opex continues to improve profitability, delivering a 1H operating profit for the first time since September 2013, even as contract wins continue from new and existing customers and the customer profile reiterates the quality of the software. Eighteen months after the arrival of CEO Klaas van der Leest, the improved performance has clearly become a trend, and the group’s confidence is expressed in targeted investment to accommodate channel sales and co-ordinate centralised R&D to a clear road map. The horizon for Intercede brightened dramatically at prelims in June when the two-year recovery plan was delivered in a year – now the sun appears to be coming up. 80p target reiterated.
Companies: Intercede Group
As noted in the trading update, H1 was in line with expectations. It highlighted that this year will be particularly H2-weighted, with £8.8m sales in H1 delivering a small Adj. PBT. The expectation of a record H2 is underpinned by substantial annual contract renewals from licences signed in H2 LY; strong visibility on new contracts due to initiate in H2; and a significant pipeline of new business in negotiation with existing clients who continue to derive substantial benefits from D4t4’s data management solutions. We reiterate our FY forecasts and TP.
Companies: D4T4 Solutions
It is evident from the interims that FY 2019 will be notably H2 weighted, as H1 sales have seen a shift to an annuity model away from large licences. Although H1 revenue grew by an impressive 14% YoY to $2.7m, we forecast 72% YoY growth for the FY, leaving $7.8m required in H2. Management remains confident that this is achievable as sales accelerate though the year: $2.5m has been booked to date in Q3, with visibility on a further $1.1m for a total $6.3m of visible revenue YTD. The remaining $4.2m should be derived from a $9.2m near-term pipeline covering a wide range of products into a number of existing and new customers. On that basis, we retain our current forecasts, targeting a return to large licence sales in Q4. There is increased risk in this weighting, but PTRO is investing significantly in sales and delivery capabilities and has a track record of success in cross-selling and up-selling into its global telecoms group customers.
We continue to take a selective stance on stocks within the small cap Technology space. The sector’s equity performance was lacklustre over 2019, rising 4% and keeping pace with the All-Share index (relative to multi-year periods of outperformance) as investors took a cautious stance on geopolitical and macro risk. We believe cautious sentiment is likely to dominate trade during the first half of 2020 and maintain our preference for consumeroriented players, consistent with our Arden Thematic Technology framework. Our top picks for 2020 are CDM, EVRH*, SUMO and VNET.
Companies: CALL CDM FDEV KWS SUMO TM17
With FY19 in line with its targets, Idox is ready to continue the process of shifting to a recurring or SaaS revenue model over the coming years. Today’s trading update points to end Oct run-rate ARR of £38.9m, up 16% organic yoy, with a contracted order book of £12.1m up 29% underpinning the outlook for continued growth. We expect the shift to a cloud-first, SaaS revenue model will both accelerate growth and reduce costs. This makes the forward FCF yield of some 7% noteworthy.
Reiterating the October trading update commentary, investment in developing the enterprise focus of the group has led to larger contract wins. While this will benefit 2H20 and underwrite FY21 revenue growth, we trim FY20 and FY21 adj EBIT expectations by 9% and 11% respectively, with additional investment in infrastructure reducing FCF to still strong £11.4m (FY20) and £18.6m (FY21). With bold statements of investment from identification of opportunities, we look forward to proof of organic execution, alongside further acquisitions. Target 450p reiterated.
Companies: Iomart Group
Strong organic revenue growth in H120 was boosted by several multi-year fraud licences and the contribution from the VIX Verify and IDology acquisitions. During H1, GB Group (GBG) made good progress with its strategy to expand internationally and enhance its product functionality and datasets. Management is confident of meeting consensus expectations for FY20; while our forecasts are unchanged at the operating profit level, a higher effective tax rate reduces our normalised EPS forecasts by c 3% in FY20–22e.
Companies: GB Group
The technology commercialisation Company focused solely on cyber security and risk, has today announced receipt of accreditation by The Council for Registered Ethical Security Testers (CREST) for its penetration testing services, whereby Crossword’s consulting division is engaged to simulate cyber-attacks against its customers to identify weaknesses within their cyber-defences. The means that the Company now holds certifications from CREST, IASME and Cyber Essentials Plus. This is an important quality assurance stamp in a currently unregulated industry. We believe this is a vital seal of approval for a service where the risks of engaging an unscrupulous or incompetent provider could be catastrophic.
Companies: Crossword Cybersecurity
CentralNic has announced the acquisition of Team Internet for a total consideration of $48m. The acquisition will be financed in part by a further €40m bond issue under identical terms to the €50m issue announced on 23 May 2019. Team Internet operates a ‘domain monetisation’ platform, allowing domain name owners to monetise dormant domains to generate recurring income to offset renewal fees and earn a profit. This provides a complimentary service to existing CNIC services: clients currently pay CentralNic subscription fees to register and renew domain names. Team Internet had revenues of $66.7m in the 12 months to June 2019, with EBITDA of $10.6m. We expect this transaction to have an immaterial impact to 2019E due to timing and be 43.8% accretive to 2020E earnings. Post completion, we estimate net debt:EBITDA will be 2.1x in 2020E falling to 1.6x in 2021E.
Companies: Centralnic Group