Shore Capital Markets has reiterated its positive stance on networking and cyber security solutions group BATM Advanced Communications Ltd (LSE:BVC), following the company's interim results for the first half ending June.
BATM’s “very pleasing” results, which were in line with the house broker's forecast, showcased good progress across the group, reflecting BATM's renewed focus on core technologies.
Total group revenues in the six months ended 30 June 2023 rose to US$60.2 million, up from US$57.5 million in 2022, while adjusted gross margins improved to 35.3% from 31.6% last year.
Underlying earnings, excluding share-based payments, increased to US$4.4 million in the first half of 2023, compared to US$3.8 million in the first half of 2022.
“Positive underlying revenue trends were seen in the first half across the group,” noted ShoreCap, with BATM’s Edgility edge computing offering set to see revenue acceleration in the following interim periods.
ShoreCap was also pleased by BATM’s strong cash position.
“We believe that BATM is delivering strong underlying progress across the development of its span of technologies, these moving towards potential market inflection points, presenting a profitable high-growth opportunity to investors,” said analysts.
“With commercialisation, positive operating leverage to reported results should be expected in due course - leading to an increasingly attractive fundamental valuation."