Avast (AVST) endured a rocky start to 2020. Towards the end of January, shares in the cybersecurity group tumbled after allegations surrounding the sale of browser history data by its analytics subsidiary Jumpshot. This culminated in Avast winding Jumpshot down with immediate effect – and agreeing to buy back the 35 per cent investment that Ascential (ASCL) had made in the business.
The group will incur $15m-$25m (£12m-£19m) in one-off closure costs and will repay Ascential $73m. For the current year, bosses anticipate mid-single-digit organic revenue growth and a stable cash profit margin.
For 2019, results were in line with management’s expectations. Growth was driven by the group’s largest consumer direct desktop business, for which adjusted revenues rose by 9 per cent to $633m – or 11 per cent organically. The consumer direct mobile business saw a 9 per cent decline in revenues, partly due to multi-platform subscriptions being sold through desktop – a trend that will continue. But Avast added that performance in its mobile carrier channel has also been hit by lower marketing investments by US carriers. Overall, it anticipates mid-single-digit revenue decline for mobile in 2020.
Broker Peel Hunt expects adjusted EPS of 31.2¢ for 2020, down from 32¢ in 2019.
| AVAST (AVST) | ||||
| ORD PRICE: | 408.6p | MARKET VALUE: | £4.12bn | |
| TOUCH: | 408.2-408.6p | 12-MONTH HIGH: | 552p | LOW: 277p |
| DIVIDEND YIELD: | 2.8% | PE RATIO: | 20 | |
| NET ASSET VALUE: | 111¢ | NET DEBT: | 79%** | |
| Year to 31 Dec | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
| 2015* | 251 | 71.7 | 76.0 | nil |
| 2016* | 341 | 19.5 | 26.0 | nil |
| 2017* | 653 | -28.9 | -4.0 | nil |
| 2018 | 808 | 183 | 26.0 | 8.6 |
| 2019 | 871 | 315 | 26.0 | 14.7 |
| % change | +8 | +72 | - | +71 |
| Ex-div: | 21 May | |||
| Payment: | 24 Jun | |||
*Pre-IPO figures (Avast floated in 2018) £1=$1.29 **Includes lease liabilities of $64.8m | ||||
