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Summary – In this report we outline the investment case for four companies that we believe have transformative growth potential: Bigblu Broadband, Audioboom, ULS and Beeks. We also include the current sector valuation, our recent research, and a profile of all of the companies covered by the 4-strong Tech Research team at finnCap.
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Bango (BGO): Corp Audiens impresses as a standalone operation | Oncimmune Holdings (ONC): Corp Initiation: real-world lung cancer screening to drive sales
Bango Oncimmune
Plaid, the U.S. start-up, whose software helps link fintech apps with people's bank accounts, said on Thursday it was now rolling out its services in Ireland, France and Spain. According to consultancy firm EY's global fintech adoption index, Ireland's level of adoption stands at 71%, Spain's at 56% and France's at 35%. "Ireland is going to continue to grow and generate really fantastic companies," Plaid's chief said. Plaid is one of our top two Fintechs to watch. PayPal is making the biggest acquisition in its two-decade history, announcing on Wednesday that it's buying Honey Science for about $4 billion. Honey, which is best known for providing a service that helps consumers find deals while they shop online, works with 30,000 online retailers and claims to have 17 million monthly users. PayPal said Honey's technology will help it reach consumers as they begin their "Shopping journeys" with personalized offers. In our view, PayPal’s deal may demonstrate a step toward the new normal of leveraging consumer data. Commission-free stock trading app Robinhood has announced plans to officially launch in the UK next year, marking its first market outside the US. The fintech 'unicorn' opened a waiting list for UK customers following yesterday’s announcement, with Rander Rutgers, head of Robinhood UK, telling Yahoo Finance UK that the app would be tailored to the UK market. We believe that the solvency of a number of UK-based legacy brokers will be tested as aggressive subsidisation and lower overheads of FinTechs drives down pricing.
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Bango has announced the launch of Direct Carrier Billing (“DCB”) payment services for Google’s YouTube TV Service, with the initial launch via a “leading” but unnamed US Mobile Network Operator (“MNO”). With the ongoing growth in US Over The Top (“OTT) video services continuing to cannibalise the Cable TV operators, we believe DCB for YouTube TV is a strong offering in a large market. The release is light on detail as to the potential value to Bango, and we make no revisions to forecasts. Nevertheless, the launch represents a further win in an area of strategic focus for the group. It also confirms the integration of a major new merchant service into the Bango Platform.
Bango
Bango (BGO): Corp | Savannah Resources (SAV): Corp | Tracsis (TRCS): Corp
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AT&T announced the launch of HBO Max streaming service for May 2020, with a new "Game of Thrones" series at the current HBO price of $15/month. The move surprised analysts and investors attending the Warner Media presentation on Tuesday as it was lower than expected. HBO Max is expected to reach 75 million to 90 million global subscribers by 2025, with about 50 million of these coming from the United States. The success of HBO Max is in many ways a referendum on a strategy to merge content with the means to distribute it. Challenger banks and FinTech firms are expected to have half of all consumers using their payments, card and retail banking accounts in the next three years, according to Capgemini. The group’s World Retail Banking Report highlights how challenger banks are changing the overall banking journey as well as offering customers new services, like quick or early access to funds not covered by traditional loan or card systems. Traditional banks have the right product but are "Lagging behind and giving ground to non-traditional payers in the last-mile customer experience". In our view this should surprise nobody. But the acid test of trust through a future financial crisis is yet to occur. Huawei Technologies lifted its share of China's smartphone market to a record 42%, with third-quarter shipments rising by two-thirds as domestic consumers rallied behind it after US sanctions, data released on Wednesday showed. Huawei strengthened its dominance of the world's biggest smartphone market even as the Chinese company was all but banned by the US in May from doing business with American companies, significantly disrupting its ability to source key parts We are surprised by the strength of recent data supporting Huawei.
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African Export-Import Bank a supranational financial institution whose purpose is to facilitate, promote and expand intra- and extra- African trade, of its potential intention to publish a registration document, the Bank hereby confirms its intention to proceed with an Initial Public Offering. The GDRs are expected to be admitted to the standard listing segment of the Official List of the FCA and to trading on the Main Market of the LSE. DNEG Limited intends to apply for admission of its Shares to the premium listing segment of the Official List of the FCA and to trading on the London Stock Exchange's main market for listed securities. The Offer will be comprised of new Shares to be issued by the Company (to raise expected gross proceeds of £150m). Admission is expected to take place in November 2019.
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The recent run-up in semiconductor stocks hit a speed bump Tuesday afternoon that could turn into much more. Texas Instruments gave a forecast that was much worse than expected in a Tuesday earnings report, raising questions over whether the cycle is anywhere near the trough as was widely expected.
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Bango recently announced that its resale routes reach over 2bn subscribers. In this note we discuss an area which we believe could represent a material future growth opportunity – bundling and resale. The group’s initial focus is on OTT service providers, where we expect the addition of new OTT service providers and new resellers to the Bango Platform to drive growth. With a number of resale routes already announced, the group is already gaining commercial traction. Partnerships with global internet leaders such as Amazon, Pandora and Spotify further validate the service.
Facebook's Libra plans continue to stumble as PayPal quits the digital currency project, with Visa and Mastercard also reconsidering their involvement. In a statement late on Friday, PayPal says it has decided to "Forgo further participation in the Libra Association at this time and to continue to focus on advancing our existing mission and business priorities”.
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Amazon is in talks to bring the cashier-less technology that runs its Go stores to other retailers like airport shops and movie theatres, according to people familiar with the matter. The effort would help Amazon grow its retail presence, so the company can lower its reliance on online shopping, but at a faster pace and at lower cost than building its own stores
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Stripe Inc said on Thursday it is raising $250 million in its latest funding round, which values the payments start-up at $35 billion, a dramatic 56% surge from a previous valuation at the start of the year. The latest valuation puts Stripe in the same league as home rental giant Airbnb Inc, which is also planning go public in 2020. Stripe has received strong positive feedback from our private FinTech contacts. Meanwhile, the IPO pipeline for 2020 is already heating up.
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Facebook has been working to develop augmented reality glasses out of its Facebook Reality Labs in Redmond, Washington, for the past couple of years, but struggles with the development of the project have led the company to seek help. Now, Facebook is hoping a partnership with RayBan parent company Luxottica will get them completed and ready for consumers between 2023 and 2025, according to people familiar. Needless to say, we highlight a potentially substantial threat to Snap Inc, and a potentially huge opportunity for developers within the Facebook ecosystem.
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These are exciting times for Bango as it matures and expands. After many years building merchant and carrier connections and volumes, the payment processing platform has reached profitability and will rapidly scale revenue on a fixed cost base. The data business is a natural evolution, driving greater payment volumes in a steadily accelerating virtuous circle; adding more data sources will spin it ever faster. Well-managed by an experienced team and uniquely positioned in a high growth industry, we launch coverage with the Interims in a seminal year: Bango is now fully funded and its revenues continue to grow rapidly, targeting breakeven this year and promising significant cash profits from next. We feel the market has yet to fully appreciate the exciting prospects for Bango and set a 225p target price.
Bango has announced solid H1 2019A results in our view, with momentum remaining strong. At £467m, End User Spend (“EUS”) was confirmed as having more than doubled for a fifth consecutive year, and underlying opex levels remain broadly stable. A further highlight was the positive contribution from the data business, which now contributes over 25% of group revenue. We make revisions to FY 2019E earnings estimates following the release, noting, inter alia, Bango’s continuing commitment to investment in R&D to support its innovative product development. We also introduce FY 2020E forecasts for the first time which reflect the fruits of that investment.
Bango (BGO): Corp A wheel of fortune | K3 Capital (K3C): Corp Continuing to build a unique business model | KRM22 (KRM): Corp Interims | NAHL (NAH): Corp Transformation on track | Quixant (QXT): Corp Market share loss at key customers will leave H2 short
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Wirecard has signed a memorandum of understanding with SoftBank's Brightstar and anticipates "Significant transaction volume" out of the deal, the German fintech announced on Monday. Under the agreement, digital financial services via a Brightstar platform are expected to be handled by Wirecard as the preferred payment service provider, Wirecard said. In our view, Wirecard’s MoU with Brightstar demonstrates SoftBank’s plan to promote interaction between its expansive portfolio network is beginning in earnest. We believe the resources of the combined US$100bn worth of investments is formidable, and if SoftBank can drive cooperation, there is scope of substantial value creation – which may help to justify some of the stand-out premiums implied at its investment rounds. ZAO, a new Chinese app that lets users swap their faces with celebrities, sports stars or anyone else in a video clip - racked up millions of downloads on the weekend but swiftly drew fire over privacy issues. The app's surge in popularity and sudden backlash from some users highlights how artificial intelligence technologies bring about new concerns surrounding identity verification. Digital privacy, data protection - and now images and biometric data – is being captured and commercialised at a pace that legislation in most economies is struggling to keep pace with in our view. We believe data, analytics and privacy will become a key theme of decade as consumers, governments and MNCs become increasingly aware of assets that were not considered valuable or sensitive just a few years ago. This is a structural theme we will be watching very closely as a potential edge (or liability) to business models on a medium-term horizon.
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Apple has committed to spend more than $6 billion on original TV shows and movies for its forthcoming Apple TV+ service, according to a Financial Times report on Monday. Apple previously said to expect its streaming service focusing on original content to launch in the fall, and the report says that Apple is looking to turn its service live in the next two months, before Disney+ launches on November 12.
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An official at China's central bank has said the institution is nearing the launch of its digital currency. Speaking at an event in China over the weekend, Mu Changchun, deputy director of the payments unit at the People's Bank of China, said its researchers have been hard at work since last year to complete the systems needed to support the digital yuan offering and that it is "Close to being out." The news was reported by Bloomberg on Monday.
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SDIC Power Holdings China’s state-backed energy firm has received government approval to issue 10% of its share capital as Global Depositary Receipts (GDRs) on the London Stock Exchange
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Walmart Inc's Indian unit Flipkart is set to roll out a free video service for all its 160m customers this month as the ecommerce company looks for new ways to increase its user base in smaller towns and cities, it said on Monday.
After holding the title for more than a decade, Apple has been dethroned as the king of cash by Alphabet. The Google parent's holdings of cash and marketable securities, net of debt, topped $117 billion in the most recent quarter, exceeding Apple's recently reported cash pile of $102 billion, according to the Financial Times, which first reported the shift. British fintech firm Revolut is jumping into the online brokerage space with its own commission-free stock trading platform. The new service will allow users to buy a fraction of a share, with the minimum amount being $1 worth of stock. AMD reported mixed results in its earnings report Tuesday. The stock was down Wednesday as total revenue declined year over year, with the chipmaker blaming lower graphics channels sales and lower semi-custom product revenue for the declining revenue.
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Bango released its H1/19 trading update on 10 July, indicating that End User Spending (EUS) had grown to over £465m in the period, more than double the same period last year and slightly ahead of our run-rate forecast expectation of £458m. Revenue for 1H/19 is up 64% to £4.3m (versus growth of 54% to £2.6m in H1/18). We have left our forecasts unchanged and expect growth in EUS to remain in line with current expectations during H2/19 (FY19E £1.26 billion). Migrations of large scale DCB routes to the Bango platform (Bango has previously said that its pipeline of potential migrations is over US$4 billion) could lead to significantly increased step change in EUS, in turn significantly expanding the audience data sets available to app developers through Bango Marketplace.
Spotify stock dropped over 1% on a Bloomberg report that Apple plans to fund its own original podcasts. Apple executives have reached out to media companies to buy exclusive rights to podcasts, according to the report. Amazon has a promotion for US shoppers on Prime Day, the 48-hour marketing blitz that started Monday: Earn $10 of credit if you let Amazon track the websites you visit. The catch, as Amazon explains in the fine print, is the company can use this data to improve its general marketing, products and services, unrelated to the shopping assistant. Curve, the London-based “over-the-top banking platform,” has raised $55 million in new funding. The start-up lets you consolidate all your bank cards into a single Curve card and app to make it easier to manage your spending and access other benefits. The new round of funding values Curve at $250 million and will be used by the company to continue adding more features to its platform and for further European expansion.
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This trading update highlights the growing strength of Bango’s position. The payment processing platform continues to make excellent progress on the back of rapidly growing End User Spend (EUS), its revenues now covering the cash costs. The cash it generates will fund development of the new exciting data monetisation business, which has made an encouraging start; making early sales while its range of audiences offered expands. In turn, it should feed platform volumes in a virtuous circle to grow the whole group business. Overall, H1 revenue grew 64% YoY to £4.3m, assisted by a full half of Audiens. The full results are out in September.
Samsung said on Friday that profits for the three months that ended June more than halved from a year earlier following continued weakness in the price and demand of memory chips. The world's largest smartphone maker and supplier of memory chips said operating profit was at $5.5bn, which was slightly better than an industry estimate of $5.1bn but was down about 56% from a year earlier. Netflix has announced it's taking a long-term lease on Shepperton Film Studios near London. Its plan is to create a dedicated UK production hub, including 14 sound stages, workshops and office space at the site owned by the Pinewood Group. Digital bank Monese and PayPal have launched a joint service that allows customers to "Seamlessly" manage their accounts. Customers at the London-based bank, which operates across 31 European countries, will be able to add their Monese card to a PayPal digital wallet, allowing them to buy and sell to any of the payments firm's 277 million consumers and merchants around the world.
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This morning, Bango announced final results for the year to December 2018. During the period End User Spend (EUS) continued the trend of recent years and has more than doubled to £558.2m and revenue up 60% to £6.6m (FY18: £4.2m). Adjusted LBITDA improved to -£0.9m (FY18: -£1.6m), with positive EBITDA achieved during Q4/18. Following the Audiens acquisition in early 2018 and investment in further development, December 2018 saw launch of Bango Marketplace. This is a new business segment, adding a potentially significant and high margin revenue stream, monetising the extensive and growing amount of transactional data from the Bango Platform. There remains a growing pipeline of new MNO/App Store integrations and further Google Play upgrades, representing a significant pipeline of over US$4 billion in EUS.
This note summarises the information delivered at Bango’s Jan-19 Strategy Day and analyses the key messages. In particular, we look at the group’s updated strategy, with its increasing focus on the data opportunity and the new Bango Marketplace product. The core payments business continues to grow strongly and, in our view, the increased focus on data is both strategically sensible and represents a material growth opportunity. We continue to believe that Bango is well placed to deliver on its targets, and we are making revisions to estimates following the Strategy Day and recent Trading Update.
United Oil & Gas (UOG.L) an oil and gas exploration and development company brought to the Official List (Standard Segment) in July 2017 by way of a reverse takeover of Senterra Energy plc. No capital to be raised, expected market cap of £17m and expected 28 Feb Techniplas –global producer and support services company providing highly engineered and technically complex components, making the supply chain to original equipment manufacturers more efficient. FYDec17 rev $515m. Polemos, to be renamed Digitalbox plc, has agreed to acquire Digitalbox Publishing Holdings Limited for c.£10m through a share for share exchange. The acquisition constitutes a RTO. Polemos has also agreed to acquire the entire issued share capital of Mashed Productions Limited, a digital media business which owns the online satirical news website "The Daily Mash", for a maximum total consideration of up to £1.2m. Market cap on admission £12.4m, expected 28 February
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This morning, Bango announced a trading update for the year to December 2018. During the period End User Spend (EUS) continued the trend of recent years and has more than doubled to over £550m, though EBITDA is expected to be below expectations with increased new product development following the Audiens acquisition in early 2018 and switching some short-term fee based revenue to subscription based. This development culminated in the December 2018 launch of Bango Marketplace and has added a new, high margin revenue stream. There is a growing pipeline of new MNO/App Store integrations and further Google Play upgrades, representing well over US$4 billion in EUS.
This morning, Bango announced interim results for the period to 30 June 2018, showing a strong increase in End User Spend (EUS), up 138% to £220m. EUS growth remains on track to more than double for the fourth consecutive year. Audiens has added a completely new and high margin, revenue stream during the period and there remains a growing pipeline of new MNO/App Store integrations to complete as well as further Google Play upgrades, together representing well over US$4 billion in EUS. Further expansion of the Bango platform has also enabled MNO customers to sign-up for Amazon Prime Video in the US, UK and India, and Pandora customers in the US; generating new subscription-based revenues for Bango.
Bango has reported solid interim results in our view. The payments business grew strongly, with End User Spend growth of 138% YoY, alongside a first full accounting period of positive EBITDA. The data business (including Audiens) is making good progress, and overall, we believe the group continues to deliver solid operational momentum. The outlook remains upbeat, giving confidence in H2 financial performance.
This morning, Bango announced a trading statement for the six month period to end June 2018. Interim results will be announced on 18 September 2018. Momentum in EUS activity over the Bango Platform has continued to grow with EUS of £220m in H1/18 and remains on track to more than double for the 4th consecutive year. Audiens SRL, acquired in early 2018, has been integrated into the Bango platform and is trading in line with expectations. Audiens has added a completely new, high margin, revenue stream and there remains a growing pipeline of new MNO/App Store integrations to complete as well as further Google Play upgrades.
Bango has announced FY17A results ahead of our forecasts, with financial performance once again demonstrating strong growth and platform scalability. Momentum remained strong during the year, with End User Spend (EUS) confirmed as having more than doubled but opex having grown by just 13%. The positive outlook statement will give confidence in the near-term financial performance. Our FY18E adjusted earnings estimates are unchanged following the release and FY19E forecasts are introduced for the first time.
This morning, Bango announced final results for the year to 31 December 2017 showing End User Spend (EUS) up 105% to £271.4m and revenue up 61.5% to £4.2m. Momentum in EUS activity over the Bango Platform has continued, with the February 2018 exit run rate well ahead of this time last year, at £465m. 2017 was an important year for Bango with the Amazon physical goods direct carrier billing (DCB) launch in Japan and Reseller Amazon Prime Video launching in India with Bharti Airtel, as well as achieving run-rate EBITDA break-even in November 2017. 2018 should see Bango’s move into profitability and cash generation.
This note aims to summarise the information delivered at Bango’s recent Strategy Day, and to analyse the key messages. Our analysis focuses on four areas – the group’s strategy, the data opportunity and Audiens acquisition, an update on the Japanese business and the emerging resale and bundling opportunity. The presentation was well attended and provided a useful opportunity to meet the broader Bango executive team. We continue to believe that Bango is well positioned to deliver on its targets, and we confirm our forecasts following the event.
Bango this morning announced that it has acquired Audiens SRL, the data management subsidiary of Digitouch S.p.A. (DGT: Borsa Italiana) and issued 2.78m new shares at a price of 180p to raise gross new funds of £5m. Total consideration payable for Audiens includes €1.48m (£1.3m) in cash, €0.63m (£0.55m) to be paid to Digitouch for provision of shared services for up to 12 months, 521,803 Bango ordinary shares which have been issued at 180p and the grant of 738,399 warrants over Bango ordinary shares exercisable for a period of 10 years also at 180p. Bango is already a trusted partner for many digital merchants and mobile network operators (MNOs) and the addition of the Audiens platform extends Bango’s existing data analytics platform significantly, accelerating the development of the Bango data monetisation business, Bango Deep. As well as driving EUS, Bango Deep opens up the potential for substantial additional revenue generation from the digital advertising market.
Bango has announced that it is providing resale and bundling technology for Amazon in India, enabling Bharti Airtel mobile customers to sign-up to Amazon Prime. The launch represents an expansion of the Bango Platform (“BP”) beyond Direct Carrier Billing (“DCB”), and also increases Bango’s exposure to a sizeable mobile and e-commerce market. The release contains no details on the contract terms and we make no changes to forecasts at this stage. Continuing Bango’s recent trend of contract wins with top-tier internet players, in our view the contract demonstrates the ongoing momentum in the Bango business and the versatility of the BP.
Bango has announced the launch of carrier billing for Netflix subscribers in Mexico. The company has also confirmed that the overall business performed strongly during H2 17E, with the key End User Spend (“EUS”) metric having more than doubled over FY 16A (+105%). Furthermore, with a £4.8m cash balance, the Group’s financial position remains solid. The release contains no details on the terms of the Netflix launch and we make no changes to forecasts. However, the announcement gives further confidence that the Group remains on track to deliver FY 18E EBITDA breakeven.
Bango this morning announced a trading update and that it has partnered with Netflix to launch carrier billing for mobile subscribers in Mexico. End User Spend (EUS) in the year to December 2017 has grown significantly, up 105% to £271m. Overall trading for 2017 is in line with market expectations. Bango achieved a number of critical milestones during 2017, especially the facilitating of physical goods DCB payments for Amazon, a worldwide first for Amazon using this payments channel, and representing a significant endorsement of the Bango Platform. Bango also confirmed in November 2017 that it had achieved EBITDA run rate break-even. The addition of this new payments route going live with Netflix shows Bango’s broadening and growing influence amongst major brands in the provision of DCB and related services.
Bango has announced what is, in our view, a significant new payment route in Nigeria, giving 9mobile’s 17.2m subscribers the ability to charge purchases of digital content from the Google Play store to their 9mobile 9pay mobile wallet. The release follows the recent announcement with Victory Link in Egypt, but contains no details on the contract terms and we make no revisions to forecasts at this stage. With a growing mobile subscriber base, high Android penetration and low banking/credit card adoption, we continue to believe that Africa represents an attractive growth opportunity.
Clean Invest Africa—Introduction due around 14 Nov. Vehicle established to identify investment opportunities and acquisitions in renewable and clean energy projects/companies or alternative technologies that are used in a socially and environmentally responsible way that will aid the development of the African continent. Beeks Financial Cloud -niche cloud computing and connectivity provider for automated (algorithmic) trading in Forex and Futures financial products . Raising £7m. Mkt Cap c.£24.5m. Due 27 Nov. FYJun17 rev £4m. Profitable at operating level. City Pub Group - owner and operator of an estate of 34 premium pubs across Southern England. £30m raise. Consistent track record of strong revenue and EBITDA growth, with a three year CAGR from FY14 to FY16 of 34.9% and 44.8% respectively, and an EBITDA margin of 14.7% in FY16. Due late Nov. Offer TBA. Boku - Independent direct carrier billing company. Revenues were up 21% to US$10.2 in HYJun17. Q32017, revenues grew to $6.5m, up by 44%. The Company also saw continued growth across all of its key metrics: user numbers, total payment and a positive adjusted EBITDA for the month of September 2017. Due 20 Nov. Offer TBA. Ten Lifestyle Hldgs. Technology-enabled lifestyle and travel platform providing trusted concierge services to the world's wealthy. Net revenue increased from £20m in the year ended 31 August 2015 to £33m in the year ended 31 August 2017, a compound annual growth rate of 29%. Offer TBA, expected 27 Nov 2017. OnTheMarket—Intention to float on AIM to raise c.£50m which will be used to fund the growth of the OnTheMarket.com portal, already the third biggest UK residential property portal provider. Expected valuation £200m to £250m. OG Graphite, brownfield development-stage graphite company focused on the reactivation of its wholly-owned Kearney natural flake graphite mine and mill located 280 km north of Toronto, Canada. Offer TBA, expected mid November.
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Bango has today released two pieces of positive news flow. The Bango Platform (BP) is being deployed in South Korea, increasing the number of payment opportunities for digital content, physical goods and Internet of Things (IoT) services in this key Asian market. Secondly, management has confirmed the achievement of run-rate EBITDA breakeven. Having upgraded in September-17, we leave forecasts unchanged at this stage. However, today’s announcement gives further confidence in the group’s ability to meet our expectation of full-year EBITDA breakeven in 2018E.
Gfinity plc (GFIN.L, 27.6p/£52.1m) Placing (25.09.17); Season II of Elite Series announced - (20.09.17) | The Character Group plc (CCT.L, 477p/£91.9m) Update note published: FY17 PBT in line but clouds around Toys R Us (20.09.17) | Bango plc (BGO.L, 273p/£181.0m) Interims: Reasons for optimism (19.09.17) | Eagle Eye plc (EYE.L, 255p/£64.8m) Prelims: Sainsbury's and Loblaws should drive volumes (19.09.17)
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Bango has reported strong interim results, with impressive growth in End User Spend (EUS) and revenue, alongside reduced losses and cash outflow. Operational momentum remains strong, with new billing routes activated across the world. The first half also saw the launch of Direct Carrier Billing (DCB) for physical goods with Amazon Japan. We make minor increases to forecasts following the announcement, and believe the H1 2017A outcome is encouraging for the second half performance.
This morning, Bango announced interim results to 30 June 2017, showing End User Spend (EUS) growing significantly, up 100% to £92.3m, well ahead of our expectations. Revenue has more than doubled and losses have narrowed considerably. We anticipate that Bango will achieve our forecast run rate break-even by mid-way through H2/17. Facilitating physical goods DCB payments was a worldwide first for Amazon and is a significant endorsement of the Bango Platform. This represents a transformational step for Bango and we anticipate other physical goods merchants may join the Bango Platform for DCB in time.
City of London Group (COLG) - Sch 1—RTO of Milton Homes Limited, an equity release provider which has a UK residential property portfolio of 586 properties with a market value of approximately £77 million as at 30 June 2017. Offer TBA. Due 5 Oct | Springfield Properties—Scottish housebuilder. Intention to float. Offer TBA “Our turnover exceeded £100 million for the first time this year and now we employ around 500 people. This IPO is the next step in our growth.” | Warehouse REIT - The Company will invest in a diversified portfolio of UK warehouse assets located in urban areas. The Company is targeting a dividend yield of 5.5p equivalent to a yield of 5.5 percent. for the year ending 31 March 2019. Issue price 100p. Offer raising £150m at £1 with market cap of £166m. Due 20 Sep | OnTheMarket—Intention to float on AIM to raise c. £50m which will be used to fund the growth of the OnTheMarket.com portal, already the third biggest UK residential property portal provider. Expected valuation £200m to £250m. |People’s Investment Trust—Objective of sustainable wealth creation. Also to list on the Social Stock Exchange. Targeting £125m raise on 17 Oct. No performance fees or executive bonuses in order to focus on long term rather than short term performance. | Charter Court Financial Services Group—Intention to float. Specialist lender serving the UK residential mortgage market. The net mortgage loan book stood at £4.4 billion as at 30 June 2017 growing at a compound annual growth rate of 92 percent since 31 December 2014. Part vendor sale and £20m primary raise. | ContourGlobal LP—Report on Bloomberg that the thermal energy power generator is considering a London listing. | Hipgnosis Songs Fund investment Company offering pure-play exposure to Songs and associated musical intellectual property rights. Offer raising £200m at 100p. The Company has decided to extend the closing date for the Placing, Offer for Subscription and Intermediaries Offer to 1 August 2017. The Company may bring forward this closing date at any time. Admission 15 Sep.
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Bango this morning released an extremely positive trading update this morning for the six months to 30 June 2017 and provided notice of interim results on 17 September 2017. End User Spend (EUS) has grown considerably during the period, with the June 30 exit run rate advancing 54% to over £300m from the December 2016 level of £195m. Notably this is well ahead of our forecast exit run rate for June 2017 of £242.3m, an our-performance of around 24%.
Bango has announced what is, in our view, a significant Direct Carrier Billing (“DCB”) launch with Amazon in Japan. Bango Platform technology is enabling customers on Japan’s two largest mobile operator networks to purchase physical goods from Amazon Japan, charging the cost to their phone bill. We believe this is the first carrier billing payments service for physical goods from Amazon. The announcement contains no details on the terms of the transaction and for now we make no revisions to forecasts. Nevertheless, with the Japanese e-commerce market estimated at US$100bn annually and Amazon the market leader, we expect the deal to be substantial for Bango.
Bango announced this morning that it has enabled a Direct Carrier Billing (DCB) payment route for Amazon customers in Japan. This is a significant milestone for Bango having first commenced its relationship with Amazon back in late 2011. Enabling the purchase of both digital and physical goods using DCB is a worldwide first for Amazon and represents a very strong endorsement of the Bango platform in our view, particularly given Amazon’s relentless focus on providing the best levels of customer service. Today’s announcement underlines our view that Bango has created the world-wide industry standard DCB platform technology, with the broadest market reach and functionality.
Bango has reported FY 2016 results consistent with the Jan-17 trading statement and in line with our forecasts. Financial performance continues to improve, reflecting triple-digit top line growth and the scale benefit of the Bango platform technology. The Group has now reached operating breakeven, and delivered solid operational progress across the business during 2016. We leave key forecasts unchanged following the release. Nevertheless, with the activation pipeline at a record level and a solid financial position confirmed, we continue to believe that Bango is well placed to benefit from market growth in DCB1 .
Bango has announced final results for the year to 31 December 2016 showing End User Spend (EUS) up an impressive 196%. There is building momentum in activity over the Bango Platform as the number of payment routes expands and the number of users adopting Direct Carrier Billing (DCB) continues to grow. We see a clear path to cash break-even by Q4 2017 and are firmly of the view that Bango is well on the way to realising its potential for substantial step changes in EUS growth and profitability.
In this note we initiate formal coverage on Bango. In our view the growth outlook for mobile payments remains favourable and Bango is well positioned to be a key beneficiary of market growth. The Group’s recent history of execution is strong, as is its financial position. Following seventeen years of investment, the Bango platform is state-of-the-art and sufficiently scalable to support the anticipated business expansion.
Bango has demonstrated considerable operational momentum over the recent past. Organically, the business has seen impressive geographic expansion and significant investment has been made in the product suite. Furthermore, the recent BilltoMobile acquisition in the US more than doubles FY15 end-user spend. We note that the strong growth in the business comes with no increase in the company’s cost base during the last two years, a testament to the power of its technology. Bango shares currently trade at around 55% of the September 2012 level.
Eco Animal Health (EAH.L) | PhotonStar LED Group (PSL.L) | Bango (BGO.L) | DX Group (DX.L.L) | Circle Oil (COP.L) | Science Group (SAG.L) | Kennedy Ventures (KENV.L) | SyQic (SYQ.L) | Sabien Technology (SNT.L) | Intercede Group (IGP.L)
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MediaZest* (MDZ.L) | Minera IRL (MIRL.L) | GAN (GAN . L) | IronRidge Resources (IRR.L) | Palace Capital (PCA.L) | Applied Graphene Materials (AGM.L) | Rotala (ROL.L) | Epwin Group (EPWN.L) | Bango (BGO.L) | Hummingbird Resources (HUM.L)
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We present here our new momentum screen, which is intended to track the behaviour of small-cap shares experiencing the most positive technical momentum. This represents the third of our style baskets, with value and consistent growth themes already established. This is not intended to address the perennial tension between technical and fundamental analysts, merely to investigate behaviour over time. Of the 25 stocks in the basket, we have focussed on 10 which we know and believe to be particularly interesting. With the widely used dictum “the trend is your friend” in mind, we have dubbed them the “trendy friendlies”. We will monitor performance and refresh the screen in 3-4 months’ time.
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Against the backdrop of a slowdown in smartphone and tablet sales, handset makers are struggling with commoditisation and turning to accessories like VR headsets, wearables, bots and drones to gain market share.
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The Hybridan Small Cap Wrap is a weekly review of some of the most interesting small cap stories of the past week. Our review will usually be of those companies whose market capitalisations are less than £50m although we may occasionally cover larger companies.
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This report describes the global mobile app store payments marketplace, with a focus on direct carrier billing (“DCB”). DCB is the process by which mobile customers can buy digital content from app stores on their device, with the payment taken directly via their mobile bill. The key advantages over alternative payment methods are an improved payment experience for the end user, driving increased revenues for mobile operators and the app stores themselves.
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