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Ford Equity International Rating and Forecast Report
Ford Equity International Research Reports cover 60 countries with over 30,000 stocks traded on international exchanges. A proprietary quantitative system compares each company to its peers on proven measures of business value, growth characteristics, and investor behavior. Ford's three recommendation ratings buy, hold and sell, represent each stock’s return potential relative to its own country market.. The rating reports which are generated each week, include the fundamental details behind...
Group returns to revenue growth in Q3
In a brief trading update, NetDimensions has said that both revenue and invoiced sales for Q316 were slightly ahead of Q315. This is after the group reported a 1% decline in revenue in H1. We are maintaining our forecasts, which imply a 9% revenue growth in H2 and hence a strong performance in the traditionally busy Q4. In early October, NetDimensions said it has had an unsolicited approach that “may or may not lead to an offer being made for the entire issued share capital of the company”. We n...
On target for FY17 profitability
While NetDimensions (AIM: NETD, OTCQX: NETDY) announced a modest reduction in H1 revenue due to a decline in services and support, this masked an 8% improvement in high-margin licence revenues to $6.8m. Costs fell dramatically, enabling a sharp reduction in the EBITDA loss. New business is increasingly lumpy as the group targets large enterprises in high-consequence industries and we have conservatively eased our numbers. Nevertheless, the quality of business continues to improve with the emphas...
On target for FY17 profitability
While NetDimensions (AIM: NETD, OTCQX: NETDY) announced a modest reduction in H1 revenue due to a decline in services and support, this masked an 8% improvement in high-margin licence revenues to $6.8m. Costs fell dramatically, enabling a sharp reduction in the EBITDA loss. New business is increasingly lumpy as the group targets large enterprises in high-consequence industries and we have conservatively eased our numbers. Nevertheless, the quality of business continues to improve with the emphas...
Update: Strong cost discipline outweighs deferrals
In a short trading update, NetDimensions (AIM: NETD, OTCQX: NETDY) has said that H1 revenues were lower than expected due to delays in deal rollouts. The delays are expected to continue into H2; hence we have cut our FY16 revenue forecast by $1.2m to $27.0m. Nevertheless, the adjusted EBITDA loss has significantly improved and we now forecast the group to trade at breakeven in FY16 (previously a $0.6m loss). We are maintaining our FY17 forecasts, but note that if the deal rollouts do materialise...
Outlook: Secure SaaS grows 23% in H2
NetDimensions (AIM: NETD, OTCQX: NETDY) grew revenues by 12% in FY15 to $25.4m, vs January’s guidance of c $25.0m. The adjusted loss was better than we expected at $0.7m (we forecast a $2.5m loss), with gross margins and operating costs both better than expected. The industry outlook remains favourable and the group’s US peers have rebounded recently, in the wake of a two-year bear market. These peers continue to trade at significant EV/sales premiums and hence we still believe NETD shares c...
Update: Revenue grows, costs controlled
In a brief trading update, NetDimensions (AIM: NETD, OTCQX: NETDY) has said that FY15 trading was in line with expectations. It also says that the operating cost base actually fell over the year and hence the adjusted EBITDA loss will be better than current market expectations. Despite a significant de-rating in the shares of its US-quoted human capital management software peers over the last two years, these companies continue to trade on punchy EV/sales ratios. Hence we continue to believe the...
Update: Balance sheet bolstered
NetDimensions (AIM: NETD, OTCQX: NETDY) has raised £7.2m/$11.1m gross (c £6.8m/$10.5m net) in a placement of new ordinary shares. In contrast to the May 2013 placement, which was primarily about boosting the sales team, the latest fund-raising is largely about investing in R&D and support functions. It will also bolster the balance sheet, which will make the group’s products an easier sell to its increasingly blue-chip customer base, and will also provide funds for acquisitions. While there ...
Flash note: SaaS revenue grows at 24%
In a brief Q3 update, NetDimensions (AIM: NETD, OTCQX: NETDY) announced that revenue and invoiced sales for Q3 were ahead of Q314. Secure SaaS revenue grew by 24% to $2.6m (we are forecasting $5.2m revenues in H2), with invoiced SaaS sales ahead by 40% to $2.8m. SaaS is the business model of preference (NETD also offers annual licences and perpetual licences), and no data were disclosed on the other revenue types. However, deal size continued to grow, albeit at a slower rate than in recent quart...
Update: SaaS continues to shine with 30% growth
H1 results for NetDimensions (AIM: NETD, OTCQX: NETDY) were in line with the July trading update. Revenues grew 16% to $10.6m, as the group returns to more sustainable growth levels, following the 40% growth attained in FY14. We have eased our gross margin forecasts, due to the changing product mix, and our more conservative professional services assumptions, and we have eased our FY15 revenue forecast. This results in a higher FY15 loss, and we forecast the group will return comfortably to prof...
Update: H1 revenues rose by 16% to $10.6m
NetDimensions (AIM: NETD, OTCQX: NETDY) has announced that H1 revenues grew by 16% to $10.6m, indicating that the group is on track to meeting our FY15 forecasts. The average new deal size more than doubled, reflecting the group’s focus on winning larger customers in its targeted high-consequence industries, along with the higher level of services associated with these larger deals. Given that the company's US peers continue to trade at significant EV/sales premiums, we continue to believe tha...
Flash note: Strong growth continues in Q1
In a brief Q1 update, NetDimensions (AIM: NETD, OTCQX: NETDY) has reported that the strong momentum has continued into FY15. The company says that both revenue and invoiced sales in the typically quietest quarter were substantially ahead of Q114, and invoiced sales from new business rose by 29% to $2.2m. This follows the impressive 40% growth in statutory revenue reported in FY14. We are conservatively maintaining our forecasts, although the update indicates that the risks to our forecasts are w...
Outlook: Revenue growth sustained at 40% in H2
FY14 revenues for NetDimensions (AIM: NETD, OTCQX: NETDY) grew by 40% to $22.7m, compared with January’s guidance of at least $22.0m, and well ahead of the previous $20.0m guidance. The adjusted loss and cash generation were also ahead of our forecasts. The industry outlook remains favourable and the group looks well placed to achieve its goal of $50m revenues by FY18. While there has recently been a de-rating in its US peers, these peers continue to trade at significant EV/sales premiums and ...
Update: FY14 forecasts are comfortably exceeded
In a brief trading update, NetDimensions (AIM: NETD, OTCQX: NETDY) states that it expects to report FY14 statutory revenues of at least $22m. This is significantly ahead of our previous forecast of $20m, and implies FY14 revenue growth was more than 35%. Further, the company says that the FY14 loss is likely to be smaller than market expectations. We are conservatively maintaining our FY15 forecasts given the uncertain global macroeconomic outlook. We note that our FY15 revenue forecast of $26.0...
Update: SaaS and services drive very strong growth
NetDimensions (AIM: NETD, OTCQX: NETDY) has reported H114 revenues in line with the July trading update, with 40% growth to $9.1m. The growth was driven by the focus on Secure SaaS (50% growth) and Professional services (88% growth) and is an early indication that the new business plan is well on track for success. The investment phase of the new business plan has been substantially completed and the group is now focused on driving growth both organically and by selective acquisition. NetDimensi...
Update: SaaS growth accelerates to 50%
In a trading update on 15 July, NetDimensions (AIM: NETD, OTCQX: NETDY) said that H114 revenues grew by 40% to $9.1m, which reflects the impact of the significantly expanded sales force. The average deal size continued to strengthen, given the increasing focus on direct sales and the group winning more large multinational customers – these deals typically have more complex services requirements. Consequently, on 17 July the group announced plans to accelerate investment in services. We are con...
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