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Orders mount at Monitise

Orders has soared at mobile banking platform provider, Monitise - and the shares have more than doubled since our buy tip
September 2, 2011

Mobile banking platform provider Monitise has signed a slew of new deals during the year, which has boosted the order book. Moreover, chief executive Alastair Lukies expects to double revenues in 2012 and for the company to hit break even by 2013.

IC TIP: Buy at 37p

New deals, including a five-year contract with Visa, and an extension of an existing relationship with RBS has propelled Monitise's order book to £55m in the year. That contract win momentum has continued since, too, with the book having reached to £78m by the start of this month. Mr Lukies is expecting £14m of this to be recognised in the current financial year, with another £9m expected from other existing deals.

Meanwhile, with mobile banking becoming increasingly popular, Monitise's registered customer base has risen to 4.5m from 3.5m in December - accordingly, user generated revenues have more than doubled to £6.3m, from £2.9m previously. Sales from development and integration services have surged as well, to £6m from £1.4m, driven largely by new business wins. Encouragingly, the gross margin also held firm at above the group's 60 per cent target.

Evolution Securities expects a pre-tax loss of £10.2m in 2012, with a loss per share of 1.3p.

MONITISE (MONI)

ORD PRICE:37pMARKET VALUE:£260m
TOUCH:36-37p12-MONTH HIGH:40pLOW:18p
DIVIDEND YIELD:nilPE RATIO:na
NET ASSET VALUE:5p*NET CASH:£23.6m**

Year to 30 JunTurnover (£m)Pre-tax profit (£m)Earnings per share (p)Dividend per share (p)
20070.47-8.68-3.80nil
20081.49-14.0-5.50nil
20092.66-13.1-4.00nil
20106.02-17.0-3.70nil
201114.0-17.2-2.10nil
% change+133---
*Includes intangible assets of £6.8m or 1p a share **Includes £10m of short-term deposits