Document management software specialist Kofax reported a mixed performance at the half-year stage, with growth in the US and Asia Pacific offset by a decline in business elsewhere. And, while total turnover showed a modest improvement, profits were hit by $4.78m (£3m) of restructuring costs, which contributed to a 14 per cent rise in total expenses to $83.7m.
Professional services revenue, which comes from training services and application development, rose 11 per cent in the period to $13.9m, while income from providing technical support and software maintenance services grew 15 per cent at $57.1m. However, license revenue fell 4 per cent to $57.5m. Group turnover was boosted by the cash acquisition of business process management specialist, Singularity, and the group also secured a deal with Mobilflex - that should enable Kofax to develop mobile capture applications. Sensibly, though, management is retaining a cautious stance in view of a poor performance from operations in the Europe, Middle East and African (EMEA) regions. Moreover, and while there's a decent pipeline of opportunities, management expects only low single-digit revenue growth for the full year.
Investec Securities expects to increase full-year forecasts by 10-15 per cent from the current adjusted pre-tax profit estimate of $35.3m, with EPS of 26.8¢ ($40.2m and 31¢ in 2011).
KOFAX (KFX) | ||||
|---|---|---|---|---|
| ORD PRICE: | 313p | MARKET VALUE: | £277m | |
| TOUCH: | 312-317p | 12-MONTH HIGH: | 536p | LOW: 215p |
| DIVIDEND YIELD: | Nil | PE RATIO: | 31 | |
| NET ASSET VALUE: | 236c* | NET CASH: | $62.3m | |
| Half-year to 31 Dec | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2010 | 122 | 18.5 | 13.0 | nil |
| 2011 | 129 | 11.5 | 8.00 | nil |
| % change | +6 | -38 | -38 | - |
Ex-div:- Payment:- *Includes intangible assets of $183m, or 207p a share £1=$1.58 | ||||
