AIM-listed data erasure and mobile diagnostics provider Blancco Technology (BLTG:AIM) is believed to have seen a sharp growth recovery in 2021. The January to 30 June period represents Blancco’s second half of its financial year and while today’s update was figure-free, analysts are drawing their own conclusions.
‘We have continued to deliver on our strategy with growth accelerating in the second half of the current financial year,’ said Blancco chief executive Matt Jones.
Peel Hunt analysts calculate this to mean that revenue since 2021 began has increased by around 19%, despite hefty currency headwinds. Peel Hunt reckons the pound strengthening against the dollar and yen have combined to cut Sterling revenues by a combined 11%.
Blancco shares rose 3.7% in response to the update, hitting 280p.
STRONG DEAMND RECOVERY
Demand has been strong from enterprise customers and has come through the company’s network of channel partners in all geographies, with North America performing particularly well, the company said.
The update also notes that profit margins have moved higher due to ‘expense reduction measures,’ which we would take to mean jobs being axed and other operating efficiencies.
Peel Hunt estimates that Covid-19 related savings imply an 18%-plus beat to its June 2021 adjusted earnings before interest and tax profit forecast, ‘which in turn led to a 7%-plus beat on our net cash forecast.’
‘Overall sentiment is certainly very positive, especially as spending starts to unlock, driving a great second half,’ said Megabuyte’s Tom Kennedy.
Peel Hunt will for now resist any temptation to increase June 2022 estimates, although there may be scope to do so when the full year results are announced in full, probably in August or September.
Peel Hunt has a 335p share price target for Blancco, based on a discounted cash flow analysis.
