Amino has released a positive update on trading for the ten months ending September 2016. The business is benefitting from the twin effects of strong order intake, and favourable currency movements. Management believe the 2016E outcome will exceed current market expectations at the adjusted EBITDA and PBT levels. Following the release, we make upward revisions to forecasts. 2016E revenue and EBITDA increase by 5.1% and 7.7% respectively, 2017E by 4.7% and 6.8% respectively.
Strong order intake: August 2016 saw record order intake. Although the release is light on detail, we believe that strength has been seen across a number of geographies and product lines. Management also revealed their confidence in the growth outlook for the year ahead, given strength of the current order book.
A beneficiary of sterling weakness: Group financial performance is benefitting from positive currency translation and additional pricing flexibility from the ongoing weakness of sterling against other major currencies.
Forecasts increased: Following the release we make upward revisions to forecasts, which are detailed overleaf. Revenue estimates for 2016E and 2017E increase by 5.1% and 4.7% respectively. Reflecting a small degree of operational gearing, our forecast EBITDA for 2016E and 2017E increase by 7.7% and 6.8% respectively.
Following on from the PCCW contract announcement in August and the IoT deal with Alliance Communications announced in September, in our view today’s release represents further positive news flow from Amino. We look forward to a further update on the momentum in the business at the upcoming Capital Markets day to be held in London on October 31 2016.