Netcall (NET), which provides software for making telephone call handling more efficient, revealed another year of strong growth. Indeed, the acquisition of Serengeti Systems last September, an improved product suite, and growing demand for its services, combined to help boost adjusted full-year cash profit by by 22 per cent year-on-year to £4.24m.
Moreover, recurring revenues increased from £10m to £10.7m and now generate 66 per cent of total revenues. Cash generation remained strong, too, and the group boosted its net cash pile by 9 per cent in the period. Those cash-rich qualities also allowed Netcall to dramatically boost its dividend payout while leaving plenty of breathing room for another earnings-enhancing acquisition this year. "We are actively looking for new acquisitions," says chief executive Henrik Bang and, assuming deals are done at the right price, they could deliver quite a boost. "A £10m acquisition at a multiple of six times cash profits could improve full year 2014 pro forma group cash profits 37 per cent," believes finnCap analyst, Andrew Darley.
The broker currently forecasts adjusted pre-tax profits of £4.2m for 2014, giving adjusted EPS of 2.5p (from £4.1m and 2.3p in 2013) and a dividend of 0.8p.
NETCALL (NET) | ||||
|---|---|---|---|---|
| ORD PRICE: | 41p | MARKET VALUE: | £49.4m | |
| TOUCH: | 40-42p | 12-MONTH HIGH: | 44p | LOW: 26p |
| DIVIDEND YIELD: | 1.7% | PE RATIO: | 25 | |
| NET ASSET VALUE: | 14p* | NET CASH: | £9.2m | |
| Year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2009 | 3.90 | 0.75 | 1.18 | nil |
| 2010 | 4.10 | -0.24 | 0.04 | nil |
| 2011 | 13.6 | 0.55 | 0.58 | 0.4 |
| 2012 | 14.6 | 2.05 | 1.49 | 0.5 |
| 2013 | 16.1 | 2.26 | 1.65 | 0.7 |
| % change | +10 | +10 | +11 | +40 |
Ex-div: 11 Dec Payment: 10 Jan *Includes intangible assets of £12.4m, or 10p a share | ||||
