At face value, Amino Technologies’ (AMO) half-year results look less than impressive. However, this was largely to be expected. The internet-protocol TV specialist had already communicated that a major customer was changing its order phasing – meaning Amino’s revenues would see a return to “normal seasonality” with a greater second-half weighting.
On a regional basis, the order-phasing shift hit performance in North America, while Latin American sales were broadly flat, although Amino enjoyed follow-on orders here and won a key contract with a major regional operator. Closer to home, European sales saw a recovery after a customer recommenced orders towards the end of last year.
The group has also been offsetting industry-wide pricing pressures around device components, including silicon and memory, although these did contribute to a slight dampening of the adjusted gross margin. These pressures look set to continue throughout FY2018. Further down the income statement, Amino’s pre-tax loss was exacerbated by $1.6m in exceptional costs – the result of consolidating its R&D centres from three down to two.
Even so, management reiterated its full-year guidance and upped the dividend. With 75 per cent of anticipated full-year revenues already secured, and a 40 per cent rise in the order backlog, shareholders are benefiting from enhanced top-line visibility.
Broker finnCap forecasts adjusted pre-tax profits of $15.5m and EPS of 19.2¢ for the year to November 2018 (from $15.2m and 22.6¢ in FY2017)
AMINO TECHNOLOGIES (AMO) | ||||
ORD PRICE: | 199p | MARKET VALUE: | £145m | |
TOUCH: | 197-200p | 12-MONTH HIGH: | 221p | LOW: 176p |
DIVIDEND YIELD: | 3.4% | PE RATIO: | 20 | |
NET ASSET VALUE: | 94¢* | NET CASH: | $15m |
Half-year to 31 May | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (p) |
2017 | 49.8 | 6.3 | 8.6 | 1.530 |
2018** | 41.2 | -0.2 | 0.2 | 1.683 |
% change | -17 | - | -98 | +10 |
Ex-div: | 09 Aug | |||
Payment: | 03 Sep | |||
*Includes intangible assets of $58.1m, or 80p a share. **In June 2018, Amino announced that it was changing its reporting currency from GBP to USD. £1=$1.32 |