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WANdisco signed over a dozen new customers and entered a lucrative new market last year, but profitability remains a far-off prospect
March 24, 2014

As the 'Internet of Things' takes off and devices everywhere gather and transmit information, demand is rising for secure data storage. That has benefited WANdisco (WAND), which licenses out a technology that synchronises widespread data centres, preventing information from being lost.

IC TIP: Hold at 1290p

WANdisco's bookings jumped 86 per cent last year and its deferred revenues doubled as the company attracted over a dozen new customers including Canon and Cisco. Those gains stemmed from its application lifecycle management (ALM) division, which licenses out its flagship technology for use in software applications.

But WANdisco also entered the 'big-data' market, which helps enterprises use software to gather, sort and analyse huge pools of data. It integrated its technology with Hadoop, the most popular big-data platform. The company also partnered with two Hadoop distributors, and recently attracted a US university health department that wants to combine data from patient records, monitoring machines, pacemakers and other sources to allow predictive healthcare. British Gas, keen to leverage data from its smartmeters, has also signed up.

The fledgling 'big-data' division recorded bookings of $200,000 (£121,000) last year, which pales in comparison to WANdisco's costs. The company bolstered its ranks by almost two-thirds to 147 staff, meaning its cash losses more than doubled to $7.8m.

Broker UBS expects an EPS loss of 94.5p this year, rising to 120p in 2015.

WANdisco (WAND)
ORD PRICE:1,290pMARKET VALUE:£303m
TOUCH:1,270-1,310p12-MONTH HIGH:1,545pLOW: 757p
DIVIDEND YIELD:nilPE RATIO:na
NET ASSET VALUE:122¢*NET CASH:$25.7m

Year to 31 DecTurnover ($m)Pre-tax profit ($m)Earnings per share (¢)Dividend per share (¢)
20092.5-2.3-49nil
20103.0-2.0-42nil
20113.9-1.2-26nil
20126.0-8.0-49nil
20138.0-20.0-90nil
% change+33---

*Includes intangible assets of $8.1m, or 34¢ a share £1=£1.65