With the share price up 18% in the year to date, it was almost inevitable Bango PLC (AIM:BGO, OTCQX:BGOPF)’s results would be a prompt to investors looking to lock in profits.
The prelims were a reminder of what a transformational year it has been for the digital payments specialist.
At €4mln, the monetary value of the DOCOMO Digital acquisition, announced in August last year, doesn’t look significant.
However, the deal, which brings with it a step change in revenue, recurring sales and profits, could be utterly transformational two years from now.
It looks like the Bango team under chief executive Paul Larbey is starting to squeeze out the anticipated cost synergies from the transaction with US$11mln of a total of US$21mln already accounted for.
“We enter the remainder of the year in a strong position with a healthy pipeline and a profitable and cash-generative business which, combined with our strong balance sheet, enables us to continue investing in our growth strategy,” Larbey told investors.
In the 12 months to 31 December 2022, Bango posted adjusted EBITDA of US$5mln, which, while down from US$6.1mln the year before because of the "negative contribution" from DOCOMO, was ahead of market forecasts.
The number was achieved on US$28.5mln of revenues, up 38% year-on-year, with the annual recurring figure (ARR) jumping to US$5mln from US$1.1mln. ARR is expected to hit US$10mln this year, which the company said is "comfortably ahead" of guidance. It exited the year with cash of US$12.7mln.
The shares fell 6.5% on the day to 215p, valuing the business at 165p.