CentralNic’s (CNIC) pre-tax losses widened by almost a quarter to $1.4m (£1.1m) in its first half, despite the fact that the internet domain name specialist more than doubled its top-line.
Trading held up well in the period, especially in the newly outlined ‘monetisation’ division. On a pro-forma basis, its revenue climbed up by almost two-fifths to $48.5m. Meanwhile, the indirect reseller division posted a near two-thirds increase in sales to $41.2m, which was led by the acquisition of TPP Wholesale and Hexonet Group in the summer of 2019.
In the direct segment, which accounts for what was previously recognised as the small business and corporate division, revenues dipped slightly as a number of clients decided to hold off on spending in the first half, according to chief executive Ben Crawford.
Cash conversion across the group remained strong, hitting 138 per cent in the second quarter. But the company’s average gross margin dropped 8 per cent, which it attributed to the change in business blend following a string of acquisitions last year. Those purchases have pushed up net debt to $76.4m, compared with just $6m at the same point last year.
Looking ahead, the company believes it will be able to deliver full-year results in line with expectations: FactSet places consensus EPS forecast at 4.54 cents in the 2020 full year, rising to 5.22¢ in 2021.
| CENTRALNIC (CNIC) | ||||
| ORD PRICE: | 93p | MARKET VALUE: | £179m | |
| TOUCH: | 92-95p | 12-MONTH HIGH: | 95p | LOW: 42p |
| DIVIDEND YIELD: | nil | PE RATIO: | NA | |
| NET ASSET VALUE: | 38ȼ* | NET DEBT: | 104% | |
| Half-year to 30 Jun | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (ȼ) | Dividend per share (ȼ) |
| 2019 (restated) | 49.7 | -1.14 | -1.44 | nil |
| 2020 | 111 | -1.42 | -1.48 | nil |
| % change | +124 | - | - | - |
| Ex-div: | na | |||
| Payment: | na | |||
| *Includes intangible assets of $199m, or 104ȼ a share. £1 = $1.32. | ||||
