Davy Research |
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Datalex
(DLE ID)
Strong >20% growth in transaction revenue for first four months; good performance is in line with our expectations
18 May 2012
Joshua Goldman
| Closing Price: | 52c | Rating: | Outperform | 13/12/11 | Previous: | Neutral | 30/06/09 |
FACTS: Datalex has issued (May 18th) an IMS for the four months ending April 30th, 2012.
ANALYSIS: The company performed strongly in the period, with growth in transaction revenue in the four months to April 2012 of more than 20% compared to the same period in 2011. This is broadly in line with our expectations: we are forecasting FY 2012 transaction revenue up 21%. This has been helped by the significant addition of new customers with eight new contracts signed last year. Transaction revenue should continue to gain momentum as more of these customers go live. The pipeline of customers includes Delta Airlines, Westjet, Malaysian Airlines and Garuda. The company has also gained a new customer in April — a major national carrier in Asia.
DAVY VIEW: It is comforting that the company has reiterated its guidance of continuing to deliver EBITDA growth in line with that achieved in 2011, and that it expects a significant increase in its cash generation and enterprise value. We are forecasting FY 2012 EBITDA of $6.0m and FCF of $3m. We continue to see the company as an 'outperform' as it continues to grow due to its strong pipeline of customers.