AdEPT Telecom (LON:ADT) – BUY*: Finals
Market Cap: £47m; Current Price: 211p; Target Price: 230p (from 210p)
Finals: Another strong set of results (Note attached)
NORTHLAND CAPITAL PARTNERS VIEW: FY15 results marginally better than forecasts (that were upgraded at the interim stage) and April’s pre-close statement. Management has delivered its twelfth consecutive year of increased underlying EBITDA (+13.5% to £4.6m (NCPe: £4.5m)) and FY15 margins have hit another high (+140bps to 20.8%). The acquisition of Centrix, post period end, has increased its proportion of larger customers, expanded its Public Sector presence and reduced its reliance on calls and line rental. The acquisition has also broadened AdEPT’s product offering in complex unified communications, Avaya IP telephony, hosted IP solutions and managed services and brings the potential for larger system sales that would represent upside to our current forecast assumptions. The integration of the business is progressing to plan and forecasts remain unchanged at this stage. Post the acquisition, management still has sufficient firepower to make bolt on earnings’ enhancing acquisitions in what remains a fragmented reseller market. AdEPT has successfully transitioned its business from a traditional fixed line provider and this warrants a higher earnings multiple. We maintain our BUY rating and increase our price target to 230p (from 210p).
Eastbridge Investments (LON:EBIV) – CORP: Director resignation
Market Cap: £1.45m; Current Price: 0.85p
Resignation of Stuart Black as Executive Director
Stuart Black, Executive Director, has given notice that, for personal reasons, he does not wish to stand for re-election as a director at the AGM scheduled for 29th July.
The company is in discussions with a possible additional director.
Cyan Holdings (LON:CYAN) – H1 pre-close
Market Cap: £12.5m; Current Price: 0.185p
Progress on a number of fronts
H1 trading in line with management expectation with revenue of around £150k )H1 FY14: £65k).
During H1 - £1m order signed in the period with Enzen Global Solutions Pvt Ltd/Chamundeshwari Electricity Supply Corporation Limited in India; LoI from El Sewedy Electrometer Group that could be worth up to $3m to Cyan upon conversion into a purchase order; Tata Power’s successful implementation of Cyan’s smart metering solution; and raised £4.6m (gross).