Many of the world's largest car manufacturers are now using time-saving tool tracking and location software developed by Ubisense (UBI). It was a key reason for a surge in orders last year to £32.5m, up a third to a new record. That left the year-end order book up three-quarters at £17.9m, equivalent to half forecast revenue for 2014. True, adjusted cash profit was flat at £1.1m, but big contracts with many of the major automotive giants are only just kicking in and the potential here is substantial.
In Germany alone, where Ubisense works for the big three - BMW, Mercedes-owner Daimler and VW - the car assembly tools market is put at about €110m (£92m). An international roll-out is likely, and deals have already been signed in the US with both Honda and John Deere. Other Japanese manufacturers and General Motors are interested, too, but, of course, it takes time. Meanwhile, Ubisense has ramped up research and development spend to about 15 per cent of revenue, which partly explains a lack of progress on profits. Amortisation of intangibles and Far East expansion hit the bottom line, too.
Still, even after factoring in extra spending, broker Canaccord Genuity expects adjusted cash profit of £1.9m in 2014 and £3m the year after.
UBISENSE (UBI) | ||||
|---|---|---|---|---|
| ORD PRICE: | 245p | MARKET VALUE: | £56.6m | |
| TOUCH: | 240-250p | 12-MONTH HIGH: | 275p | LOW: 183p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE | 81p* | NET CASH: | £0.5m | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2010 | 17.7 | 0.4 | 3.3 | nil |
| 2011 | 23.8 | 0.1 | 0.2 | nil |
| 2012 | 24.3 | -0.7 | -2.8 | nil |
| 2013 | 27.0 | -1.7 | -8.9 | nil |
| % change | +11 | - | - | - |
*Includes intangible assets of £16m, or 69p per share | ||||
