Monitise Interim Results
Edison | Feb 15, 2013 06:01AM ET
Monitise’s H113 results confirmed that user-generated revenues continue to grow strongly, driving gross margins above 70% for the first time, ahead of target. The company reported an EBITDA loss in line with management expectations and is still on track to generate revenues above £70m in FY13. Recent partnerships and acquisitions seek to expand the product offering and add new routes to market. Proceeds from the recent fund-raising are being invested in growing the functionality of the Mobile Enterprise Platform and scaling up service delivery capability. Imminent service launches based on Monitise technology should accelerate user-generated revenues in the medium term, the key to reaching and driving profitability.
H113 Results: Tracking In Line
Monitise reported revenues that made up c 40% of FY13 guidance. User-generated revenues made up more than 50% of revenues, driving gross margins of 72% that beat the company’s 70% target for H213. The EBITDA loss was in line with management’s expectations, reflecting the high level of investment in the technology platform and service delivery capability. Net cash was £100.4m at the end of H113. The company has made progress in Indonesia, where a mobile payment service launch is imminent, and has signed up new partners to help drive sales globally.
FY13 Outlook And Changes To Estimates
The company reiterated FY13 revenue guidance of at least £70m and expects gross margins to be at least 70% for the year. Our revenue forecasts are unchanged. We have increased our gross profit forecast for FY13 but maintain our EBITDA forecasts for FY13 and FY14, as we reallocate some FY13 headcount costs to operating expenses. Factoring in higher depreciation and amortisation, we reduce FY13 EPS from -2.1p to -2.6p and FY14 from -0.3p to -0.7p. Reflecting costs related to recent acquisitions, our net cash forecasts are reduced for FY13 (5%) and FY14 (8%).
Valuation: Tracking Milestones That Drive User Adoption
Monitise trades on an EV/sales multiple of 6.4x FY13e and 4.2x FY14e. In the absence of profitability metrics to support the valuation, share price appreciation will depend on Monitise achieving its stated targets. Future milestones include Visa Europe’s and Visa Inc’s customers adopting their services, the launch of services in Asia Pacific, progress with direct sales in the US and evidence of adoption of m-commerce services. Recent mobile payment-related technology M&A highlights Monitise’s potential strategic value to larger technology companies.
Get The News You Want
To Read the Entire Report Please Click on the pdf File Below.
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.