Vianet Group - 1HFY24 trading update - positive outlook
Vianet has issued a trading statement ahead of publication of the 1H24 results scheduled for 12 December. Revenue for the half was £7.19m with an increase in recurring revenue to 87% and a jump in gross margin to 69%. Vianet was profitable in the half, excluding £0.2m in support for the recently acquired Beverage Metrics business in the US. The results were in line with management's expectations and are expected to pick up significantly in 2H24 as a result of new contract wins, and an acceleration in the roll-out of 3G replacement. Consequently, we leave our current EPS forecast unchanged and continue to expect that Vianet should return to FY20 levels of pre-tax profit by FY25 when it would be trading on a low 10x PE.Vianet Group is a provider of actionable management information and business insight created through combining data from its smart Internet of Things solutions and external information sources. Co. operates two business divisions: Smart Zones, which principally consists of beer monitoring business (including the U.S.) and gaming machine management services; and Smart Machines, which comprises vending machine telemetry and contactless payment solutions, as well as monitoring business primarily in the vending sector. Co. provides design, product development, sale and rental of fluid monitoring equipment and machine monitoring equipment, data insights and related services in these divisions.
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