Venture Advisory Monthly Wrap – February 2018

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Venture Advisory Monthly Wrap – February 2018

Venture Advisory Monthly Wrap – February 2018

Monthly Markets Wrap and Company Updates - February 2018

Key Takeaways

  • Society for Worldwide Interbank Financial Telecommunication (SWIFT) launched the New Payments Platform (NPP) in Australia to support the need for real-time payments in its digital economy. NPP’s launch is the result of collaboration among 13 members of Australia’s financial services industry, including the country’s four major banks and the Reserve Bank of Australia. Going forward, a large number of financial institutions are expected to connect to the infrastructure through one of the initial participants. The solution uses local network access points to switch payments between the participating banks and the Reserve Bank of Australia
  • Australia’s media companies sought to join German magazine publisher Bauer Media in fighting a record A$4.6mn defamation payout to Hollywood actress Rebel Wilson, arguing it set a dangerous precedent. The Australian arm of Rupert Murdoch’s News Corp, Fairfax Media Ltd, Seven West Media Ltd and Nine Entertainment Co Holdings Ltd as well as the Australian Broadcasting Corp. filed a joint motion to “intervene” in the case, a lawyer representing the companies stated. The move is a rare show of unity in an industry increasingly divided by politics
  • Australia’s technology purchases are expected to grow 4.0% to A$63.0bn in FY18 and A$65.0bn in FY19. Local companies plan to invest in technologies to help them accelerate the delivery of new value for their customers. Cloud, automation and artificial intelligence (AI) are projected to drive these technology investments. As per Forrester’s forecasts, more banks are likely to invest in open banking platforms
  • Amazon has launched its delivery business for merchants in Australia; the retail major has begun selling its in-house delivery services to third-party vendors in the country, assuming a major logistical challenge in the continent that invented the expression ‘tyranny of distance’

Telco Monthly Wrap

Media Monthly Wrap

Tech Monthly Wrap

Telco Monthly Wrap

Telco Best and Worst monthly performers

The 5 best and worst performers for the month of February 2018 were as follows:

Key company announcements

  • amaysim Australia Ltd (26 Feb) announced results for 1H18 with record revenue of A$290mn (up 115% from PY) driven by subscriber growth across the group and the addition and acquisition of new verticals, underlying EBITDA was at A$17.8mn (up 2.9% vs PY) after adding back costs incurred in connection with the integration of Click Energy, investment in new mobile products, and the launch of 'amaysim devices'. The Company in its FY18 outlook said that, it is positioned for top-line growth across the group for the full year. The outlook is supported by the strong growth experienced in the 1H and the continuation of that growth observed in January and February
  • Bulletproof Group Ltd (16 Feb) announced 1H18 results with revenues of A$23.3m which reflected a 5.0% decrease y-o-y and underlying EBITDA at A$1.9mn
  • Bulletproof Group Ltd (15 Feb) announced a scheme implementation deed with AC3, wherein AC3 will acquire 100% of the shares in Bulletproof for a cash consideration of 15.2 cents per share
  • Bulletproof Group Ltd (09 Feb) declined to make a declaration of unacceptable circumstances in response to an application dated 19 Jan 2018 by Macquarie Cloud Services regarding its conditional off-market bid
  • Chorus Ltd (26 Feb) announced 1H18 result with Operating revenue of A$499mn vs A$529mn for the same corresponding period previous year and EBITDA of A$329mn, which was almost the same as PY. The Company in its outlook said that with this 1H performance, the company is now expected to track towards to the top end of the full year EBITDA guidance range provided
  • DWS Group (12 Feb) announced 1H18 results with NPAT of A$10.1mn up 12.0% on prior corresponding period, revenue of A$61.7mn down 16.0% on prior corresponding period. The revenue was adversely impacted by renegotiated panel agreements and a tight labour market for digital specialists
  • Inabox Group Ltd (23 Feb) announced 1H18 results with revenue of A$52.9mn, up 23.6% on prior corresponding period. Period and EBITDA of A$2.4mn down 5.2% on prior corresponding period. The Company also signed an agreement with Telstra Wholesale for enablement services providing significant growth opportunity from FY19. The company also plans to launch a new higher margin cloud and communication products and services in 2H18
  • Macquarie Telecom Group Ltd (27 Feb) announced 1H18 results with revenue of A$115mn, up 8.1% vs PY and EBITDA at A$22.5mn, up 18.0% vs PY. The company in its guidance for FY18 said that, it expects FY EBITDA to be in the range of A$44.0-A$46.0mn. The company also expects material reduction in costs for balance of the year due to completion of new network operations centre
  • Megaport Ltd (21 Feb) announced 1H18 results with revenue of A$8.8mn, up by 98.0% over PY and net loss at A$13.3mn. The growth in the revenue can be attributed to increased port adoption as well as increased utilisation of services
  • Megaport Ltd (08 Feb) announced appointment of Steve Loxton as CFO effective 19th February 2018. Prior to joining Megaport, Steve has played a major role in originating Australian infrastructure investments for Canada Pension Plan Investment Board, one of the world's ten largest retirement funds. Previously, he led the ASX-listed Transfield Services Infrastructure Fund
  • MNF Group Ltd (13 Feb) announced 1H18 results with revenue at A$117mn showing an increase of 28.0% vs PY and gross margin at A$34.1mn showing an increase of 27.0% vs PY. The strong increase in gross profit is attributable to solid growth in domestic retail/wholesale and global wholesale segment of the company. The company also updated its management guidance for FY18 with full year Gross margin at A$72.3mn and revised EPS at 17.2 cents per share against the original forecast of 20.5 cents per share
  • NEXTDC Ltd (23 Feb) announced 1H18 results with revenue up 32.0% to A$77.5mn and underlying EBITDA up 41.0% to A$33.6mn, the company in its management guidance for FY18 now expects revenue to be in the range of A$152-A$158mn against the previous guidance of A$146-A$154mn, the company also expects EBITDA to be in the range of A$58.0-A$62.0mn
  • NEXTDC Ltd (15 Feb) announced that it has received a non-binding offer from an undisclosed third party which may buy all three data centres owned by APDC trust at a headline price of A$280mn. The company also said that it will continue with winding up of APDC trust and the related court proceedings
  • Singapore Telecommunications Ltd (08 Feb) announced FY17 Q3 results with revenues up 4.4%, EBITDA up 6.0%, but a decline in Net Profit after Tax of 8.0%
  • Speedcast International Ltd (28 Feb) announced that it won a multi-million dollar contract to provide satellite cellular back-haul services to Alpha Telecommunication Mali (ATEL), part of Planor Afrique Group, provider of the newest third-generation mobile network in Mali, Africa
  • Speedcast International Ltd (27 Feb) announced FY17 results with revenue of US$514mn, an increase of 136% over FY16, and corresponding EBITDA growth of 195%
  • Speedcast International Ltd (05 Feb) announced that it has secured a 10 year contract with Australian Government-owned infrastructure provider NBN Co Ltd. to deliver enterprise-grade satellite services
  • Spark New Zealand Ltd (21 Feb) announced 1H18 results with revenue of NZ$1,822mn, up 1.6% vs PY and EBITDA of NZ$463mn down 1.7% vs PY
  • Superloop Ltd (26 Feb) announced 1H18 results with revenues of A$55.5mn, up by 533% (includes BigAir acquisition contribution) vs PY and Profit after direct costs at A$30.8mn. The company expects record new sales in two consecutive quarters to contribute to growth in earnings in 2H18 and FY19
  • Telstra Corporation Ltd (09 Feb) announced 1H18 results with revenues A$12.8bn down by -0.2% vs PY and EBITDA of A$5.1bn down by -2.5% vs PY. The company also provided revised guidance for FY18 with total income in the range of A$27.6-29.5bn and EBITDA of A$10.1-10.6bn
  • Over the Wire Holdings Ltd (26 Feb) announced that Geoff Horth will leave Vocus in the capacity of CEO and the role of the interim CEO will be assumed by Michael Simmons. The company also announced that search for a new Group CEO is underway and is being overseen by the board nomination committee
  • Over the Wire Holdings Ltd (20 Feb) announced 1H18 results with revenue of A$967mn, accounting for growth of 4.0% on PY with organic growth in all operating divisions and underlying EBITDA of A$189mn reflecting growth of 8.0% driven by strong result in the Enterprise & Wholesale division. The company also revised its FY18 guidance with underlying EBITDA expected to be in the range of A$365-A$380mn and revenue in the range of A$1.9-A$2.0bn
  • Over the Wire Holdings Ltd (19 Feb) announced 1H18 results with revenue up 72.0% over PY to A$24.0mn and EBITDA up 62.0% vs PY to A$4.9mn

Forward EV / EBITDA Multiples Chart

The forward EV / EBITDA multiples for leading telco stocks at the end of the month is as follows: Telecom stocks were trading on an average forward EV / EBITDA of 11.0x and a median forward EV / EBITDA of 8.8x

Media Monthly Wrap

Media Best and Worst monthly performers

The 5 best and worst performers for the month of February 2018 were as follows:

Key Company Announcements

  • APN Outdoor Group Ltd (27 Feb) announced appointment of Philip Knox as Chief Financial Officer effective 5 March 2018. Knox has more than 30 years’ experience in CFO, Board and finance leadership roles including 11 years as CFO of Austar United Communications up to its sale to Foxtel and 9 years at Ten Network Holding
  • APN Outdoor Group Ltd (20 Feb) registered its FY17 results with revenue growing at 4.0% to reach A$343mn mainly due to digital revenue growing at healthy 13.0% and classic revenues being stable. Underlying EBITDA was up by 4.0% to A$90.3mn. In its FY18 outlook, the company said, it is mitigating the A$7.0mn EBITDA Yarra Trams contract impact. The company also said that revenue and EBITDA is skewed to the second half of the year. The company will also invest A$2.0mn during FY18 in innovation and new systems to support an audience and customer led go-to-market sales strategy
  • APN Outdoor Group Ltd (14 Feb) announced a multi-year extension of its Sydney trains contract from 30 November 2018, the contract includes key billboard and rail assets in the Sydney market including digital and classic formats
  • Domain Holdings  (26 Feb) announced that it has entered into a sale agreement with shareholders of Review Property Pty Ltd. to acquire shares in Review Property. Upon completion, Domain will control more than 98.0% of issued shares in Review property. The expected consideration for the transaction is ~A$36.0mn in Domain shares, based on projected performance and a valuation of Review property of A$72.0mn (~9.0x FY17 EBITDA of A$8.0mn)
  • Domain Holdings  (19 Feb) reported its 1H18 results with revenue of A$183mn up 12.5% vs PY and EBITDA of A$56.8mn up 8.7% vs PY. The company has presented a promising outlook for 2H18 with trading in first 7 weeks showing a Pro forma digital revenue growth of 21.0% and Pro forma total revenue growth of 11.0%
  • Asia Pacific Digital Ltd (26 Feb) announced 1H18 results with revenues at A$19.2mn and EBITDA from continuing business was -A$2.1mn. In future, the company aims to focus on lean and agile disciplines both with clients and within its own business to deliver superior results. The Company's business improved materially in Q2 following termination of the Ford account, the closure of Shanghai and from new client wins. The Company expects to become self-sustaining when its Australian business moves into profit
  • Carsales.com Ltd (06 Feb) announced 1H18 results with revenues of A$200mn growing at 12.0% vs PY and EBITDA growing at 9.0% to A$90.6mn. The growth in the revenue is attributable to strong performance by domestic private business with revenue up 20.0%. The company expects good performance to continue in 2H18 with January again proving to be an attractive month for car buyers in the domestic business
  • Event Hospitality & Entertainment Ltd (15 Feb) announced 1H18 results with net profit after income tax of A$66.9mn, an increase of A$7.6mn or 12.7% over the prior comparable period. The strong performance was achieved due to highly diversified portfolio containing strong results from Hotel and Resorts, Thredbo and Entertainment Germany divisions which off-setted the impact of a comparatively weak Hollywood film line-up on the entertainment results in Australia and New Zealand
  • Fairfax Media Ltd (21 Feb) announced 1H18 results with revenue of A$877.1mn down 3.9% from the PY, and Net profit after Tax of A$38.5mn . In its H2 outlook, the company said that it observed sales during first seven weeks of 2H to be 4.0%-5.0% below previous year with publishing trends broadly consistent with 1H
  • Fairfax Media Ltd (05 Feb) announced that it will appeal the high court decision to not give clearance or go ahead with NZME's proposed merger with Stuff Limited. The high court's findings increase the range of estimated quantifiable net benefits to the public arising from the transaction to A$133-A$209mn up from NZCC's range of A$41.0-204mn, however the high court still contended that these benefits were outweighed by the expected loss of plurality in the media. The proposed appeal will focus on the issue of plurality
  • GTN Group (28 Feb) announced 1H18 results with revenues at A$130mn, +40.0% on 1H17 and NPAT at -A$36.4mn mainly due to the U.S. losses including impairment charges of A$21.7mn
  • HT&E (15 Feb) announced FY17 results with segment revenue up 58.0% to A$472mn from A$299mn and underlying EBITDA up 30.0% to A$118mn
  • iCar Asia Ltd (23 Feb) announced FY17 results with revenue growth of 41.0% y-o-y to A$9.1mn. Losses for the year decreased by 14.0% to -A$11.8mn
  • Macquarie Media Ltd  (15 Feb) announced 1H18 results with underlying EBITDA growing by 21.0% over PY, revenue grew at 2.0% over PY to reach A$68.5mn, the increase in revenue was largely driven by core radio revenue. The outlook for H2 is positive with the company continuing to explore revenue generation from core radio output
  • Macquarie Media Ltd  (15 Feb) announced promotion of Adam Lang to the position of Chief Financial Officer, Adam Lang joined MML post merger between Macquarie Radio Network (MRN) and Fairfox Radio Network (FRN) in April 2015. Before that, Lang was CEO of FRN for 3 years
  • Nine Entertainment Co Holdings Ltd (22 Feb) announced 1H18 results with reported revenue of A$720mn growing at 7.0% over PY, Positive free to air TV ratings momentum combined with focus on 25-54 years demographics translated into improving revenue share. The group EBITDA increased by 51.0% to A$181mn, the growth included the A$17.0mn benefit from removal of the ACMA license fee and replacement with the fixed spectrum charge
  • News Corporation (09 Feb) announced 2Q FY18 results with revenues of A$2.2bn, a 3.0% increase compared to A$2.1bn during PY, the company's profitability improved by 27.0% during the 1H mainly from 21.0% revenue growth in the Real estate services business
  • oOh!media Ltd (19 Feb) announced CY17 results with double digit growth in revenue (up 13.1%) to reach A$380mn and growth of 22.5% in underlying EBITDA. The growth was backed by Digital revenue taking a big share at 59.8% of the total revenue. In its guidance for CY18, the company projected EBITDA to be in the range of A$94.0-99.0mn, the company also intends to spend A$30.0-40.0mn on Capex during the CY18
  • Pacific Star Network Ltd (28 Feb) announced that through Crocmedia, it has secured NRL broadcasting rights from 2018 - 2022 , as well as an expansion of live sports broadcast on 1116 SEN (four test cricket series between Australia and South Africa)
  • Pacific Star Network Ltd (23 Feb) announced that it will be seeking shareholder approval at the upcoming EGM for a A$10.0mn share placement to pay down a CBA debt facility of A$5.8mn, which in turn was used to fund its acquisition of Crocmedia
  • Prime Media Group Ltd (16 Feb) announced 1H18 results with revenue of A$113mn, which is down 13.3% vs PY and EBITDA of A$24.3mn, down by 22.1% on prior corresponding period
  • QMS Media  (16 Feb) announced 1H18 results with revenue up 25.0% to A$99.0mn and EBITDA up 27.0% to A$22.7mn. The growth in the revenue was on the back of strong momentum in digital roll-out with 99 landmark digital billboards operational as of December 2017. The company updated its FY18 guidance with projected EBITDA in the range of A$44.0-46.0mn
  • REA Group Ltd (09 Feb) announced results for 1H18 with revenue of A$407mn up 21.0% y-o-y and EBITDA of A$243mn up 21.0% vs PY. The revenue growth was driven by 21.0% increase in the Australian business due to growth in listings in key markets of Sydney and Melbourne. In its outlook, the company expects normal seasonality of revenue in Australia with greater revenues in first half of the year than in the second half
  • SEEK Ltd (19 Feb) announced 1H18 results with revenue of A$620mn registering a growth of 26.0% vs PY and EBITDA of A$221mn growing at 20.0% y-o-y. The company also updated its FY18 guidance projecting a revenue growth in the range of 20.0%-25.0% and EBITDA growth in the range of 14.0-15.0%. The company also provided outlook for NPAT to be in the range of A$225-230mn
  • Southern Cross Media Group Ltd (23 Feb) announced 1H18 results with group revenue at 1.3% compared to previous year at A$333mn and EBITDA at A$78.1mn, lower by A$14.5mn compared to PY. The outlook for 2H includes projection for group revenues to be up 5.0% y-o-y whilst the cost is expected to remain flat vis a vis last year
  • Southern Cross Media Group Ltd (20 Feb) announced an extension of agreement with Seven West Media on Regional television affiliation. The agreement will see SCA continue to broadcast seven's metropolitan free-to-air television content for 3 years with an option for each party to extend to a further fourth year
  • Sky Network Television Ltd (28 Feb) announced 1H18 results with a revenue decline of 5.5% to NZ$433mn, but a Net Profit after Tax increase of 12.0% to NZ$66.7mn, driven by cost savings
  • Seven West Media Ltd (20 Feb) announced 1H18 results with underlying EBIT of A$159mn, up 7.2% y-o-y, the company achieved revenue of A$811mn only marginally lower than PY. In its FY18 outlook, the company plans to deliver A$40.0mn of cost savings, offsetting the AFL uplift and the spectrum charge, which will result in an overall reduction in group operating costs
  • Village Roadshow Ltd (16 Feb) announced 1H18 results with a revenue decline of 5.0% YoY to $515mn, EBITDA decline of 36.0% YoY to A$49.8mn, and a 100% decline in NPAT to A$0.04mn. This was largely driven by the Dreamworld tragedy and a lacklustre cinema attendance
  • Village Roadshow Ltd (02 Feb) announced the NASDAQ listing of iPIC Entertainment, which VRL has a 25.0% ownership interest in, post IPO
  • WPP AUNZ (23 Feb) announced 1H18 results with revenue growing only marginally at 0.6% vs PY to reach A$870mn and reported profit before tax A$125mn, up 3.1% vs PY. The company has a strong new business performance in media, advertising and digital segments

Forward EV / EBITDA Multiples Chart

The forward EV / EBITDA multiples for leading media stocks at the end of the month is as follows: Media stocks were trading on an average forward EV / EBITDA of 9.7x and a median forward EV / EBITDA of 8.2x

Tech Monthly Wrap

Tech Best and Worst Monthly performers

The 5 best and worst performers for the month of January 2018 were as follows:

Key Company Announcements

  • 3P Learning Ltd (15 Feb) announced its results for 1H18 with revenue increasing 13.0% y-o-y to A$28.3mn, EBITDA increasing 21.0% to A$10.3mn and Net profit after Tax up 26.0% to A$4.8mn
  • Aconex Ltd (20 Feb) announced its results for half-year ended 31 December 2017 with revenue growing 13.0% to A$86.9mn, Gross Margins improving from 73.0% in FY16 to 76.0% in FY17 and EBITDA from core operations at A$9.1mn , 1.7m vs. prior corresponding period
  • Aconex Ltd (20 Feb) received a A$7.8 per share cash takeover offer from Oracle Inc. The management does not expect many shareholders to vote against Oracle’s A$1.6bn takeover proposal on March 23 vote scheduled to approve the takeover deal. Fortunately for Aconex shareholders, A$1.6bn is small change for the US tech giant, with the stock currently changing hands for $7.7, marginally below the $7.8 takeover price
  • Afterpay Touch Group (22 Feb) announced its 1H18 financial results with revenue at A$60.7mn, group EBITDA at A$12.1mn and Statutory Net Profit before tax A$0.7mn
  • Appen Ltd (21 Feb) announced its results for FY17 with revenue growing 50.0% y-o-y to A$167mn and underlying EBITDA of A$28.1mn up 62.0% over prior year
  • Altium Ltd (28 Feb) announced that it is establishing a direct business model in Spain and Italy to enhance relationships and improve the overall experience of customers using Altium Designer, PDN Analyzer, Altium NEXUS and other products. Altium Europe, headquartered in Munich, Germany, will take over responsibilities for sales and support for all existing and new customers effective 28 February 2018
  • Altium Ltd (19 Feb) announced results for 1H18 with revenue up 30.0% to A$63.2mn, 30.0% growth in EBITDA and 51.0% rise in Net profit after tax to A$14.9mn
  • Big Un Limited (23 Feb) suspended from trading, pending investigation into finances and disclosure
  • Bravura Solutions (26 Feb) announced its 1H18 results with group revenue increasing by 10.0% to A$103mn mainly due to new client acquisitions in EMEA and APAC regions EBITDA grew by 2.0% to reach A$18.5mn due to strong margins in Wealth Management offsetting the previously flagged loss of a funds administration client underlying NPAT increased 13.0% to A$14.2mn mainly due to lower interest costs reflecting lower total debt on balance sheet
  • Class Ltd. (08 Feb) announced its 1H18 results with revenue increasing 21.0% y-o-y to A$17.0mn, EBITDA increasing 23.0% to A$7.8mn and Net Profit after Tax increasing 19.0% YoY to A$4.3mn
  • Catapult Group International (22 Feb) announced its 1H18 results with revenue of A$32.4mn showing a y-o-y growth of 31.0% mainly from healthy growth in Elite wearables revenue. The management also confirmed FY18 revenue guidance of A$76.0-A$81.0mn with expected positive underlying EBITDA
  • Computershare Ltd (14 Feb) announced 1H18 results with revenue growing 10.8% y-o-y to reach A$1,112mn, EBITDA growing 20.0% y-o-y to reach A$290mn. The company also announced 11.8% increase in the 1H18 interim dividend
  • Citadel Group Ltd. (19 Feb) announced 1H18 results with revenue up 12.7% to A$47.5mn and NPAT up by 22.8% to A$6.6mn. The company also announced that it has signed up A$62.0mn worth of renewals and new contracts over the first half. The company is in the process of moving more than 17,000 new users over to cloud-based Citadel Information Exchange and over 4,000 customers using evolution. The company also reiterated that it has replicated the successful strategy pursued with Kamish, by completing the integration of Charm Health and redeveloping its software platform to deliver as-a-service domestically and internationally
  • Crowd Mobile Ltd (26 Feb) reported to ASX that it made a EURO3.0mn redemption payment under the senior convertible note deed facility in place with JGB Newton Ltd. The redemption payment was funded from the company's existing cash reserves
  • Crowd Mobile Ltd (09 Feb) announced its results for 1H18 with revenue of A$21.1mn and EBITDA of A$2.2mn after continued investments into Crowd Media division. It also projected its H218 revenue, EBITDA, NPAT and Operating CF to be in line with 1H18. However for FY18, the company expects lower sales and margins compared to FY17 mainly due to the strategic investment into Crowd Media and headwinds within Subscription Division
  • Data#3 Ltd (21 Feb) announced results for 1H18 with total revenue growing by 8.2% y-o-y to reach A$547.3mn, Net Profit after taxes was down by 52.5% at A$2.7mn. However the company maintained its outlook for the full year
  • ELMO Software (27 Feb) announced its 1H18 results with revenue from Ordinary activities growing at 48.0% to A$10.9mn, Loss for the half-year from ordinary activities was A$0.6mn
  • ELMO Software (27 Feb) announced the execution of a binding sale agreement to acquire shares of Pivot Software, for A$8.8mn. The acquisition will be funded by a mixture of Cash and Scrip. New shares will be issued at a price of ~A$5.1 per share. The acquisition is expected to be complete before 31 March 2018
  • GBST Holdings Ltd (21 Feb) announced appointment of Sophie Karzis as company secretary as part of the company's ongoing work to improve Governance and ASX compliance. Karzis has considerable expertise in providing corporate advice to ASX listed entities. Karzis would replace Philip Hains who resigned from the role of the Company Secretary
  • GBST Holdings Ltd  (21 Feb) announced that the Company was served a notice by Law Firm Squire patton Boggs by alleging that the company breached its continuous disclosure obligations and that it engaged in misleading and deceptive conduct. GetSwift announced that it intends to contest this action and legal counsel has been appointed
  • GBST Holdings Ltd (13 Feb) announced its 1H18 results with revenues of A$42.7mn down from A$45.4mn during previous year, Operating EBITDA was up 16.0% at A$9.7mn. The company also reiterated its EBITDA before strategic R&D outlook to be in the range of A$20.0-25.0mn for FY18 consistent with guidance provided in August 2017
  • Gentrack Group Ltd. (09 Feb) announced appointment of Tim Bluett as CFO, effective April 2018, following David Ingram's resignation as CFO. Tim has over 25 years of international experience in the technology and telecommunications industries and has led significant growth and change initiatives as well as M&A
  • Gentrack Group Ltd. (01 Feb) announced resignation of David Ingram as Chief Financial Officer effective 30 April 2018
  • Hansen Technologies Ltd (23 Feb) announced its results for 1H18 with operating revenue of A$118mn up 36.0% compared to 1H FY17, EBITDA of A$33.8mn +41.0% vs PY, the company also provided outlook for the 2H with revenue slightly below 1H18 and EBITDA margin to be in 25.0-30.0% range
  • Infomedia Ltd (22 Feb) announced its 1H18 results with revenue of A$35.3mn compared to A$34.8mn in the previous period and net profit after tax of A$5.7mn, down 18.0% from A$6.9mn in the previous corresponding period
  • Infomedia Ltd (22 Feb) announced acquisition of Norwegian Opoint Technology from M-brain. The transfer includes Opoint's web-crawling technology for online media, the business of web-crawling services for over 70 international media monitors and key personnel in Oslo and Chennai
  • Integrated Research Ltd (15 Feb) released its 1H18 results with profit after tax increasing by 20.0% to A$9.3mn and total revenue increasing by 5.0% to A$45.7mn
  • IRESS Ltd (22 Feb) announced its full year result for FY17 with revenues of A$430mn growing at 10.0% vs FY16 revenue and reported NPAT at A$59.8mn up by 1.0% on FY16. The results were at the higher range of the revised guidance provided by management in November 2017 mainly due to increased business and revenue momentum in the 2H, realising the benefit of investments made in prior periods the company plans to continue its strategy of providing integrated, market-leading products, with critical milestones achieved to existing and new clients
  • iSelect Ltd (16 Feb) announced financial results 1H18 with revenues growing at 7.0% to A$83.3mn and underlying EBIT to A$3.5mn. As per management's guidance, the growth in the revenue was driven by a combination of 5.0% growth in customer leads, strong conversation rates being maintained and a 6.0% growth in volume. The company showed continued growth in Health and Energy & Telco verticals along with strong growth in general insurance
  • iSentia Group Ltd (26 Feb) announced its 1H18 results with revenues declining to A$70.8mn from A$79.6mn during previous corresponding period; revenue growth was impacted by the operating environment in ANZ which was partially offset by growth in Asia's Value added services
  •  iSentia Group Ltd (26 Feb) announced the resignation of its Managing Director and CEO, John Croll. John Croll has given 6 months' notice period to the company and he will support and assist the board until a successor is found. The company plans to immediately conduct an external search to find a replacement
  • Impelus Ltd. (28 Feb) announced its 1H18 results with revenue of A$15.5mn (1H FY17: A$27.1mn) reflecting scale back of Carrier Billing operations. The Company's 1H18 EBITDA was A$2.2mn compared to A$2.1mn a year back. In H2, the Company plans to increase its investment in the growth and development of the new DPM assets throughout 2H FY18
  • Impelus Ltd. (09 Feb) announced that it tried to resolve the issue with Telstra but without success and now intends to initiate proceedings in the Supreme court of NSW to seek injunctive or expedited final relief to prevent Telstra from ceasing to provide it with the services from 2 March 2018
  • Impelus Ltd. (01 Feb) announced that Telstra has announced its intention to cease providing the DCB (Direct Carrier Billing) services effective March 2, 2018. Impelus contents that Telstra has a continuing obligation to provide it with the services after March 2. Both the companies agreed while reserving respective rights to try and resolve the issue. In case of failure to resolve, the Company plans to aggressively pursue its rights and seek injunctive or expedited final relief
  • Kogan.com Ltd (22 Feb) delivered a strong 1H18 result with revenue exceeding A$200mn at A$210mn which was 45.7% up on prior year. The half year trading EBITDA of A$14.1mn exceeded PY proforma EBITDA by 93.2%. The company announced fully franked interim dividend of 6.9 cents per share
  • Link Admininstration Holdings Ltd. (22 Feb) announced 1H18 results with revenues growing at 27.0% vs PY to A$503m and operating EBITDA at A$148m growing at 36.0% vs PY. The company also completed acquisition of Link Asset Services in November 2017 as announced earlier. The company did not give any guidance regarding 2H revenue/EBITDA, however, it wants to carry good earnings momentum into FY18 and also wants to maintain its Proforma EBITDA/Net Debt at the current level of 2.5x
  • Melbourne IT Ltd. (21 Feb) released its FY17 financial result with revenue in FY17 increasing by 17.0% vs PY to reach A$198mn and EBITDA growing at 13.0% vs PY to reach A$31.9mn. The Company expects its underlying EBITDA for FY18 in the range of A$41.5-45.5mn and underlying undiluted EPS in the range of 17.3-19.6 cents per share. During the year, the Company successfully completed the integration of Net registry and UberGlobal realising A$10.0mn of annualised synergy savings in the process
  • MYOB Group Ltd. (23 Feb) announced its FY17 results with revenue growing to A$416mn up 12.0% over PY and underlying EBITDA growing to A$190mn up 11.0% on PY. In its FY18 guidance, the company expects organic revenue growth in the range of 8.0-10.0% with EBITDA margins in the range of 43.0-45.0%. The company also projected FY18 R&D investments to be ~16.0% of the revenue
  • Nearmap Ltd. (21 Feb) announced its 1H18 results with revenue growing at 27.0% to reach A$24.7mn vs PY. Group's EBITDA was at A$1.2mn which was down from A$2.4mn of EBITDA during the same period last year. The management upgraded its FY18 guidance with incremental Annualised Contract Value (ACV) and sales team contribution ratios broadly consistent with 1H
  • Pushpay Holdings Ltd. (13 Feb) announced that Guy Weismantel has joined Pushpay's executive team as Chief Marketing Officer. Guy has over 20 years of experience in driving bottom-line results through differentiating branding, product messaging, product positioning and strategic customer engagement
  • Pro Medicus Ltd. (16 Feb) announced its 1H18 results with revenue at A$16.6mn up 9.0% vs PY and underlying after tax profit of A$5.4mn up 33.0% vs PY. The company remains debt free and announced a fully franked interim dividend of 2.5 cents per share
  • Reckon Ltd (28 Feb) announced its FY results for the period ended 31 December 2017, with revenues more than doubling to A$21.0mn and net profit quadrupling to A$7.6mn, due to the company's improved branding and competitive advantage in E-Learning market. The company aims to expand further into Chinese and global markets and is targeting larger and more profitable projects in future
  • Reckon Ltd (13 Feb) announced its results for the year ended 31 December 2017 with revenue growing at 1.0% vs PY to reach A$48.9mn. The EBITDA for the year also grew by 1.0% vs PY. Management in its earnings guidance expected the revenue from continuing operations in FY18 to be similar to FY17, in the range of A$48.0-49.0mn. EBITDA for FY18 is expected to be in the range of A$15.0-16.0mn
  • Reckon Ltd (13 Feb) announced its expansion in Asia by forming a JV Company named 'Shanghai reunet Technology Co ltd' in collaboration with leading Japanese E-Learning provider, NetLearning Inc. The newly formed company will focus on a range of services for the Asian market including mainland China, Hong Kong and Singapore. Its services would include the provision of E-Learning solutions and services and the commercialisation of comprehensive E-Learning programs
  • Trade Me Group Ltd (28 Feb) announced its 1H18 results reporting revenue of A$123mn up 6.8% y-o-y and EBITDA of A$79.0mn up 5.7% y-o-y. The company also announced an interim dividend of 9.1 cents to be paid on March 2018. The company kept its outlook unchanged for FY18 with y-o-y EBITDA and NPAT growth at a lower rate than in FY17 due to targeted investment
  • Wisetech Global Ltd (21 Feb) announced its 1H18 revenue of A$93.4mn, up 31.0% vs PY and EBITDA at A$31.8mn. The company also maintained its FY18 guidance in line with 1H18 performance
  • Wisetech Global Ltd (07 Feb) announced acquisition of Intris NV, the leading Belgium provider of freight forwarding, customs and warehousing management solutions. The purchase cost comprises of A$11.9mn upfront, with a further multi-year earn-out potential of up to A$5.5mn related to integration, product development and customer conversion. The transaction will act as part of the continued expansion of Wisetech's Global footprint and broader pan-European capability
  • zipMoney (26 Feb) announced its 1H18 results with record revenue of A$16.0mn registering a growth of 139% over PY For FY18, the company aims to achieve CF breakeven on a monthly basis and continue to grow the merchant and customer base

Forward EV / EBITDA Multiples Chart

The forward EV / EBITDA multiples for leading tech stocks at the end of the month is as follows: Technology stocks were trading on an average forward EV / EBITDA of 12.9x and a median forward EV / EBITDA of 12.0x

Reference stocks

Our reference portfolio is as follows:

Telecom Stocks:

5G Networks (5GN-AU), amaysim Australia Ltd. (AYS-AU), Bulletproof Group Limited (BPF-AU), Chorus Limited (CNU-NZ), Hutchison Australia (HTA-AU), Inabox Group Ltd. (IAB-AU), Macquarie Telecom Group Limited (MAQ-AU), Megaport (MP1-AU), MNF Group Limited (MNF-AU), Netcom Wireless (NTC-AU), Nextdc Limited (NXT-AU), Over the wire (OTW-AU), Singapore Telecommunications Limited (Z74-SG), Spark New Zealand Limited (SPK-NZ), SpeedCast International Ltd (SDA-AU), Spirit Telecom (ST1-AU), Superloop Ltd. (SLC-AU),  Telstra Corporation Limited (TLS-AU), TPG Telecom Limited (TPM-AU), Vita (VTG-AU), Vocus Group Limited (VOC-AU)

Media Stocks:

APN Outdoor Group Ltd. (APO-AU), Carsales.Com Limited (CAR-AU), Domain Holdings Australia Ltd. (DHG-AU), Asia Pacific Digital Limited (DIG-AU), Event Hospitality & Entertainment Ltd. (EVT-AU), Fairfax Media Limited (FXJ-AU), HT&E Ltd (HT1-AU), iCar Asia Ltd. (ICQ-AU), Macquarie Media Limited (MRN-AU), Nine Entertainment Co. Holdings Pty Ltd. (NEC-AU), News Corporation Shs B Chess Depository Interests repr 1 Sh (NWS-AU), oOh media Ltd (OML-AU), Pacific Star Network Limited (PNW-AU), Prime Media Group Limited (PRT-AU), REA Group Ltd (REA-AU), Seek Limited (SEK-AU), SKY Network Television Limited (SKT-AU), Seven West Media Limited (SWM-AU), Southern Cross Media Group Limited (SXL-AU), Trade Me Group Limited (TME-NZ), Village Roadshow Limited (VRL-AU), WPP AUNZ Limited (WPP-AU)

Tech Stocks:

3P Learning Ltd. (3PL-AU), Aconex Ltd (ACX-AU), Altiumc (ALU-AU), Afterpay Touch Group Ltd. (APT-AU), Appen Ltd. (APX-AU), Big Un Limited (BIG-AU), Bravura Solutions Limited (BVS-AU), Catapult Group International Ltd. (CAT-AU), Citadel Group Ltd. (CGL-AU), Class Ltd. (CL1-AU), Crowd Mobile Limited (CM8-AU), Computershare Limited (CPU-AU), Data#3 Limited. (DTL-AU), DWS Limited (DWS-AU), ELMO Software Ltd. (ELO-AU), GetSwift Ltd. (GSW-AU), Gentrack Group Ltd (GTK-NZ), Hansen Technologies Limited (HSN-AU), Infomedia Ltd (IFM-AU), IRESS Limited (IRE-AU), Integrated Research Limited (IRI-AU), iSentia Group Limited (ISD-AU), Kogan.com Ltd. (KGN-AU), Link Administration Holdings Ltd. (LNK-AU), Impelus Ltd (MBE-AU), Melbourne IT Ltd (MLB-AU), Megaport Ltd. (MP1-AU), MYOB Group Ltd. (MYO-AU), Nearmap Ltd. (NEA-AU), Netwealth Group Ltd. (NWL-AU), Nextdc Limited (NXT-AU), OFX Group Ltd. (OFX-AU), Pro Medicus Limited (PME-AU), Pushpay Holdings Ltd (PPH-NZ), Reckon Limited (RKN-AU), Technology One Limited (TNE-AU), Webjet Limited (WEB-AU), Wisetech Global Ltd. (WTC-AU), Xero Limited (XRO-NZ), Zip Co Ltd. (ZML-AU)