Amino has announced H1 18 results consistent with the June-18 trading update and confirming management’s unchanged FY 18E expectations. As previously signalled, H1 18 financials were impacted by the phasing of orders by a major customer, and management expect the business to return to a more normal seasonality for the full year. Over 75% of expected FY 18E revenues were secured by the end of June-18, together with an order book up 40% YoY and management’s ongoing focus on supply chain optimisation, we see grounds for optimism in the second half outcome. We therefore make no changes to forecasts following the announcement aside from reflecting the adoption of US Dollar reporting by the Group.
As signalled in the June-18 trading update, management expect 2018 to see a return to more normal seasonality, with sales weighted towards H2. H1 18 revenue was 17% lower than the comparable period, with adjusted PBT 58% lower. The phasing of deliveries from a major customer in North America was the primary cause of the declines. Unfavourable pricing trends for certain inputs (memory) continue to impact margin, although the effect is being mitigated by tight supply chain management.
Standalone software sales continue to grow strongly (H1 18 +24% YoY, 11% of turnover), and were a key driver of improved revenue visibility. Annual run-rate recurring revenues were $4.7m (+$1m) for the period.
H1 18 cash performance was strong, with 93% adjusted operating cash conversion. With closing net cash at $15m, the financial position remains solid.
Management re-iterated its expectation for FY 18E performance to be in line with previous expectations. 75% of FY 18E revenue is already secured, the order book has seen 40% YoY growth, with “good” pipeline coverage for the remainder of the year
Amino made solid progress against each of its three strategic objectives during the period and has also streamlined the product suite. IP/Cloud TV everywhere saw a significant deployment with Dutch cable operator DELTA. The group’s Android TV offering saw initial orders from North America and saw a platform upgrade to Android “O”. The group has also built a “solid” pipeline in STB upcycling.