Gresham has delivered H1 19% organic revenue growth with cash EBITDA margins rising to 8% from 6% and adj. FD EPS up 74% yoy as organic leverage and accretion from Electra kicks in. Clareti ARR has risen 18% organic with $ denominated revenues helping protect against £ weakness. H1 revenues of £23m leave a comfortable £19m to do in H2 and H1 adj. EBITDA of £4.5m is tracking at least in line with our FY22 forecast of £9.2m. Bigger picture, Gresham estimates that the marginal cash EBITDA margin on £1 of incremental ARR is some 40%, vs. the average 8% just reported in H1. We believe this presages a period of rapidly expanding FCF as the SaaS model evolves.
