Successful five-year contract extension

Hybridan Small Cap Feast - 06 Mar 24

6th March 2024 @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 objecti

On autopilot, time to kick back and relax

While no company can ever be complacent enough ‘to announce victory’ we believe Netcall inspires a level of confidence to think several years ahead – way beyond its current £30m ACV, thanks to the business’ impressive and consistent growth (u/l Cloud ACV +28% y/y) which is being cleverly carved from a highly defined (but large) target market, whereby both existing and prospective customers still offer material growth potential. Indeed in conjunction with an accelerating product roadmap (empoweri

Steady interim progress

A safe haven is worth a premium

In a business/macro environment that’s far from benign, Netcall stands out through its consistent and compounding growth - 1H24 again a good example, as u/l ACV has continued to grow strongly: +18%, driven by Cloud products: +28%. Total ACV now £30.1m. We attribute this success to market tailwinds (shifting spending patterns in NET’s favour) and also through smart execution and product design, as through a targeted approach, the company is able to better serve customers (and so out-compete large

Strong Skores across the board

All on track

Hybridan Small Cap Feast - 20 Nov 23

20th November 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 obj

Going out with a Bang

Not afraid to take a long-term view

FYJun23 results are in line and confirm a very strong year: sales +18% y/y (recurring +32%, now 72%/sales), while ACV is up strongly too: +15% y/y (or 20% u/l) driven by a noticeable uptick in new biz and also 122% NRR. All these metrics scream ‘quality business, doing well’and so given this, a c.7% FCF yield doesn’t stack up. We sense that the market is either hung up on NET’s contract renegotiation and/or market risks. This note address both these points and how these concerns are over-done an

Investing for growth

Cloud demand continues

See the wood for the trees

FYJun23 sales and EBITDA are both line at £36.0m (+18% y/y) and £8.0m (+25% y/y), while y/e net cash is materially a/h at £24.8m, such implying very strong FCF of c.£8.5m (~145% conversion) and considerably a/h of our £3.9mE. Y/e ACV: £27.9m ~+15% y/y, but 6% shy of our forecast, as Netcall has not benefitted from the anticipated growth of a key account and rather this contract has been renegotiated (from $7m pa. to $4m) albeit now with a longer duration: running for a further 5 years, not 2. Th

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'

Alphawave Semi: FY23 trading update, amended forward guidance

Alphawave Semi has reduced guidance for FY23 and prospectively citing lower revenues from China, changes in expected revenue recognition from long-term contracts, and continuing investment in R&D. The share price has reacted negatively, giving up most of the gains since the trading statement at the end of January. Current consensus, which is a good match for pre-existing guidance, should be reduced, most likely following release of the FY23 results and full 1Q24 trading update due on 23 April. H

Audioboom Group - Q1 24 revenue growth of +11%, FY24E forecasts reiterated

Audioboom’s FY23 results and Q1 trading update show Q1 24 revenue growth of +11% yoy, $6.7m of March 2024 revenue marking the platform’s highest revenue month since May 2022, and a confident outlook that leads us to reiterate our FY24E forecasts. Following the focus on new initiatives through FY23, the platform is now in its strongest ever operational position, with a record 1.1bn monthly ad impressions created in March 2024, record global audience reach of 38.6m unique global listeners in Janua

Crimson Tide - FY23 reports +15% revenue; investment phase complete

Crimson Tide has reported FY23 results to December in line with expectations, with additional operating leverage benefitting updated FY24 and maiden FY25 and FY26 forecasts. FY23 delivered +15% revenue growth to £6.2m at 86% GM, of which over 90% is recurring, and maintained £5.8m ARR even after unexpected customer churn in the year as we previously noted. Crucially, the Group achieved milestone adj EBITDA profitability of £0.4m at 7% EBITDA margin, and edges closer to adj PBT profitability expe

Morning Note – 16 April 2024

Devolver Digital (DEVO LN) - Rebuild year

Devolver Digital encouragingly delivered 2023 results slightly ahead of expectations and provided a steady medium-term outlook that leads us to reiterate our 2024 Adjusted EBITDA estimates. Longer term, the company is now planning to further develop its two major planned titles, Human Fall Flat 2 and System Era's next major new release. We now expect those major titles to be released in 2026 rather than 2025, meaning we lower our 2025 Adjusted EBITDA forecast to $10.6m from $17.6m but introduce

Morning Note – 15 April 2024

Intelligent Ultrasound Group - GE Healthcare launches new Voluson Signature with

GE Healthcare has announced the launch of the Voluson Signature 20 and 18 ultrasound systems, with the related press release noting these systems ‘comprehensively integrate artificial intelligence’ to improve the ultrasound procedure for clinicians and the women being scanned. These ultrasound systems include SonoLyst, the AI which incorporates Intelligent Ultrasound’s ScanNav Assist and ScanNav AutoCapture AI software. The launch of additional Voluson systems including the SonoLyst suite of AI

Checkit - New product launch and contract wins

Checkit has won contracts with two customers worth at least £417k over the three-year lives of the contracts, confirming its ability to upsell to its existing customer base and supporting our forecasts. Having trialled the new technology with multiple customers, Checkit has launched its Asset Intelligence module, which uses advanced analytics and machine learning to enhance customer sustainability, reduce costs and increase revenue.

Soft growth patch

Auction Technology Group - H1/24 Trading update

ATG’s H1/24 trading statement indicates revenue for the six-month period to 31 March 2024 was $86m, a 6% increase on H1/23 (1% organic growth), helped by the addition of the EstateSales.Net (ESN) marketplace last year, which performed well in the period. Total marketplace revenue increased 2% (organic), driven by growth in value-added services (VAS) and event fees, offsetting a decline in commission revenue (mainly through lower asset prices).

Morning Note – 17 April 2024

Touchstar - Full year results: Recurring revenue strategy delivers further profit growth

Touchstar is a supplier of mobile data computing solutions and managed services to a variety of industrial sectors. This morning's full year results reflect the outcome of a multi-year strategy coming to fruition for the group, with recurring revenue growth of 8.7% delivering overall revenue growth of 7.1% and in turn a 60% increase in PBT to £0.7m. Over the past few years, Touchstar has focused on enhancing the returns from their product offering through a shift towards recurring software licen

It’s not what you sell, it’s the way that you sell it

This report is intended to help UK small- and mid-cap investors gain a better understanding of software companies’ routes to market, and to highlight how one of the most important facets of the way in which they grow and deliver value is routinely ignored.  We examine sales processes for six UK-listed companies and one that has recently been taken over, and consider why they have followed their respective paths.

LIBERUM: Cirata plc: Cirata from the flames

Engage XR Holdings - Expanding from FY23, FY24E forecasts reiterated

ENGAGE XR’s FY23 results show revenue and net cash in line with the February trading update, EBITDA ahead at -€4.0m vs -€4.5m due to the split of cash outflow between opex and working capital, and a confident outlook that leads us to reiterate our FY24E forecasts. FY23 revenue for the core ENGAGE platform was unchanged vs FY22 at €3.3m, as H2 23 revenue was impacted by the record seven-figure contract announced in February shifting to 2024, and several enterprise customers scaling back renewals