Good news keeps flowing

Oxford Metrics’ interim results for the six months ended 31 March 2022 showed a strong performance by the company, most notably with regards to the record strength of the order book, £12.95m at period end. Management estimates that the H1 revenue of £12.55m could have been held back by component supply constraints to the tune of around £2m, but notes that the situation is gradually improving. These results follow the exciting news on 30 May that OM had sold Yotta, its infrastructure asset management software business, for a cash consideration of £52.0m. Management is understandably confident that the company is on track to achieve its financial expectations for the full year. We are revising our estimates to reflect the Yotta disposal but maintain our stance on OM’s trading prospects.

Good news keeps flowing

With a clear roadmap of new digital inkjet products and an ambitious management team focused on gaining (or retaining) significant market shares across the segments that make up its $1bn addressable market, Xaar is positioned to grow strongly. Management has already demonstrated its abilities in turning the business around, and we believe it is far from clear that the share price fully reflects the opportunities ahead.

Roadmap to significant profit growth

Today’s AGM statement confirms that, with strong trading so far this year, Kape is on track to deliver in line with guidance ( revenue of $610-624m and adjusted EBITDA of $166-172m ( for FY22. The statement makes clear management’s confidence in the outlook for the business and the potential for it to drive growth both organically and through acquisitions. The update reaffirms our confidence in Kape and the company’s long-term prospects.

Executing against key objectives

Idox’s half-year results for the six months ended 30 April 2022, released yesterday, contained no major surprises given the contents of the trading update issued on 19 May. We are not changing our revenue or profit forecasts. Revenue was up 7% at £33.2m (H1 FY21: £31.1m) and adjusted EBITDA was up 8% at £11.0m (H1 FY21: £10.1m). The Public Sector business has provided the robust result we expected, with percentage revenue growth in the double digits, while the Engineering business has had some impact that can be attributed to wider economic concerns. Based on current trading, contracts, pipeline and prospects, management remains confident that the business will deliver on the solid growth in revenue and adjusted EBITDA that are suggested by our forecasts.

Moving forward

Sopheon’s AGM Statement, issued today, provides a reflection upon a busy FY2021 and looks forward to what has already started as a year of progress in FY2022. In FY2021, Sopheon grew recognised revenues and annual recurring revenues by 15%, beating market expectations in the process. The year also saw a new CEO and a reinforcement of the management team, along with the acquisition of ROI Blueprints. FY2022 appears to have started well, with six new customer wins (all SaaS based) already, compared with 10 in all of FY2021, and with the acquisition of Solverboard, announced in May. We are leaving our forecasts unchanged and continue to be impressed by Sopheon’s expansion and SaaS transition as management grows a more substantial business with greater long-term revenue visibility.

Strong start to another year of progress

Today’s H1 trading update from Idox confirms that the first half of the year has seen a solid financial and operational performance, in line with management’s expectations. We leave our forecasts intact and look forward to the results in June as an opportunity to find out more about the strong operational progress that the business is making.

H1 update – robust, positive performance

Gamma has today issued a Q1 trading update, coinciding with its AGM. The update confirms that the year has started positively, with revenue growth across all operating segments. Management expects this positive momentum to continue throughout the year, with full-year adjusted EBITDA and adjusted EPS being in the upper half of market estimates. We have tweaked our FY22 revenue estimate down (£495m to £488m) but left our earnings figures intact.

Q1 update – on course for another growth year

Sopheon has today announced the acquisition of the business and assets of Solverboard, a UK-based SaaS software business that provides innovation management software focused on the early stages of product development. This is an interesting transaction that should speed up Sopheon’s transition to a full SaaS business. Solverboard is an early-stage business with relatively low costs, and we are not adjusting our estimates at present.

Solverboard acquisition speeds SaaS transition

MJ Hudson’s Q3 FY22 trading update, issued on Thursday 12 May, revealed that the company’s results for the full year are expected to be significantly ahead of our, and the market’s, expectations. Adjusted EBITDA for the year is expected to be at least £8.3m, against our estimate of £7.5m and a prior-year figure of £5.6m. We have adjusted our forecasts for both FY22 and FY23 following this statement (see table overleaf), with our FY23 Adjusted EBITDA estimate going from £9.0m to £10.5m. The key drivers to the strong performance are the company’s ‘three transformative growth areas’: ESG & Sustainability, the Irish Super ManCo and Luxembourg fund services.

Market’s questions answered

CML has a strong niche position in wireless communications chips, built upon its technologies and skills in analog design and compound semiconductors. It is well-placed to capitalise on the exciting opportunities presented by the next generation of wireless communications across 5G, the Industrial Internet of Things, satellite and voice communications.

Sμrfs up

Shearwater has published a trading update for the year ended 31 March 2022. As a result of a strong H2, revenues for the full year are materially ahead of our, and market, expectations, with management now expecting £35.5m for FY22, up 12% on FY21 and £2.0m ahead of our forecast. The update also states that EBITDA is expected to be in excess of £4.2m, ahead of our forecast of £4.1m. This statement, alongside recent contract wins, shows that management’s hard work in recent years is paying off. We have adjusted our FY22 figures to reflect this good news, and look forward to the final results in July as an opportunity to find out more and revisit our FY23 estimates.

Trading significantly ahead of estimates

MJ Hudson has today released its interim results for the six months ended 31 December 2021. The results confirm that the group continues to make strong progress, with particularly impressive performance in the software-driven Data & Analytics division and in the long-term recurring contract-based Outsourcing division. The outlook statement reaffirms the growth message of the January update and discloses that full-year results are expected to be at the upper end of market expectations. For now, we are maintaining our estimates, but note the upside risk to our forecasts.