 Onwards and upwards !
Interim Results
Calnex Solutions is pleased to announce unaudited results for the 6 months ended 30 September 22.
Financial Highlights
GBP000 H1 FY23 H1 FY22 FY22 H1 YOY% change
Unaudited Unaudited Audited
Revenue 12,728 9,251 22,046 38%
Underlying EBITDA 3,466 2,479 6,351 40%
Profit before tax 3,086 2,308 5,973 34%
Basic EPS (pence) 2.78 2.05 5.19 36%
Diluted EPS (pence) 2.67 1.99 5.00 34%
Closing cash including fixed
term deposits 14,436 13,643 15,357 6%
-- Revenue increase a combination of strong underlying growth and the impact of currency movements.
-- Gross margin and Underlying EBITDA margins maintained in line with the prior period, despite the challenging external economic environment.
-- Continued planned investment in product development and operational scalability, to support future growth.
-- £1.3m cash generated in the Period after £2.3m net acquisition cash cost for the iTrinegy acquisition.
-- Solid EPS growth in line with the profit performance for the Period.
-- Interim dividend of 0.31p pence per share to be paid in December.
Operational Highlights
-- Relationship development with hyperscale customers progressing well, with new Network Synchronisation product, Sentry, due to be launched in H2, enhancing product offering for the cloud computing market.
-- Acquisition of iTrinegy Limited, enhancing the Group's position as a leading network emulation test vendor, with integration progressing as planned.
-- Successful mitigation of well-documented, global supply chain shortages to date, shipping scheduled orders as planned.
-- Continued investment in talent globally.
Outlook:
-- Strong order book as we move into H2 FY23.
-- The Board is confident that performance for FY23 will be in line with market expectations.
Tommy Cook, Chief Executive Officer, and founder of Calnex, said: "We are pleased to deliver a strong financial performance during the period, significantly increasing revenue and profit, while continuing to invest in our team's capabilities and offering. We were delighted to successfully complete the integration of the iTrinegy team into the Group during the period. Whilst it is sensible to look to the future with a degree of caution given the continuing component shortages and global macro-economic challenges, the Company's positive trading performance during the period and proven ability to manage component shortages underpin the Board's confidence that the Group's performance for FY23 will be in line with market expectations. The breadth of our customer base across multiple regions, ongoing successful expansion of the team and offering, and wealth of industry connections combine to place Calnex in a strong position to continue to benefit from the underlying long-term growth drivers in the telecoms and cloud computing markets." |
Mike Seidenberg, the new lead manager of Allianz Technology Trust, believes the big positive for technology companies is a shrinking US work force as the numbers of babies and retirees grow. That means businesses will have to turn to technology to deliver their services efficiently and at low cost with US tech spending forecast by Fundstrat to soar to a a record 5.5% of GDP by 2045, compared to 3.6% in 2015. Previous periods of US labour shortage in the 1950s-60s and 90s saw tech shares go ‘parabolic’, says Seidenberg, and there is good reason to believe they'll do so over the next 2 decades. |
A strong Q3 update from Spirent this morning, which bodes well here. Summed up by:
"Strong quarterly trading performance, high win rate and record orderbook"
"Spirent will continue to benefit from the long-term structural growth drivers in our industry as our customers demand more rigorous end-to-end assurance and testing solutions to deliver faster, more resilient, more reliable networks" |
Thanks, riv - interesting find, hopefully the iTrinegy acquisition will open up new markets and address a new customer base. CLX certainly had high hopes in the FY results. |
Interesting in these times of war to see CLX exhibiting in the USA this month as regards secure military networks:
"Calnex will be exhibiting at I/ITSEC 2022, in the WEST Concourse – Orlando, Florida, USA. November 28th – December 2nd 2022.
Visit our booth #473 to discover how the NE-ONE by Calnex is used to model realistic military networks in secure, controlled environments in order to verify application and system resilience before deployment into real world battlefield network environments.
Learn more about how Governments, Military Organisatizatins and Defense Contractors use NE-ONE Software Defined Test Network technology:
Also good to see iTrinergy at Space-Comm 2022 in Farnborough given the thriving UK space sector's need for secure comms and data:
EDIT - good to see an almost £14,000 buy at 149p just now - a full 1p above the published 148p offer price. Keen. |
Been away on family hols for nigh on three weeks, so good to see the recent bounce here following the positive AGM update and the bullish results and outlook from Spirent. |
Gap on the chart is filled at 1.20 wait until then I'm my option nearly there .. |
Getting into bargain territory ! |
Gap on the chart at 120 so will wait to buy then I think --gaps tend to get filled |
In case anyone else was wondering, the company has just informed me that they will not be issuing a trading statement this year. Last year's statement was necessary because the Board anticipated that revenue and profits for the full year would be materially ahead of previous expectations.
Consequently, it can be deduced that the company is, currently, trading in line with the Board's expectations as they would be required to issue a statement if it were not. Conversely, it can also be concluded that the company is, currently, not trading ahead of the Board's expectations. |
Engineering Director has been consistent seller - probably personal reasons |
I would like to jump in on this share I like all it has to offer .. there's just something about the Director sells that niggles me any thoughts any one |
Don't disagree, I like the company, executed well so far and I hope there is an update soon. Need to confirm still on target for expectations in my view. Otherwise, in the current market, I fear the mid 20s PE will drop a fair bit. There was also a 90,000 share sale last week by the VP of Engineering. |
#675:Some recent Director sales too.
True, but these were Tommy Cook selling just 5.5% of his holding and the FD selling 33,000 shares (14% of her holding of 236,000) after being granted options on 500,000 shares.
The circa 20% fall in the shareprice over the past 6 months just reflects the broad market trend which has hit all mid and small caps and it is actually a lot lower decline than has been experienced in the broader market during that period. In fact Spirent, who is the major customer for CLX, has seen a 12% increase in their shareprice during that period. Furthermore, circa 85% of CLX sales are billed in $US so they should also benefit from the recent sterling weakness.
"The global market for telecoms test and measurement equipment in 2020 for mobile networks alone was estimated by Frost & Sullivan to be around US$1.3bn and is forecast to exceed US$2bn by 2024." Annual Report 31/3/22
Current PER for 22/23 is circa mid-20's which is not a particularly high metric for an expanding Tech business in a very fast growing market. There should be a first half trading update any day now. |
But not yet. Maybe chip supply problems?
apad |
It has held up pretty well compared to others in a really poor market. That said, although stating in line with expectations in the August AGM statement, there was a reference to a 'H2 weighting'. Some recent Director sales too. There was a Trading Update on 12 October last year. Maybe another one around the corner? |
Now at an 8 month low. |
Ben Rogoff, the manager of Polar Capital Technology, says that “technology is still the story of the decade and has driven earnings growth both in its own and other industries.” Consultants Gartner expect IT spending to have increased by 3% this year to $4.5trn, with growth skewed to artificial intelligence, security and cloud computing. Rogoff expects revenues and earnings growth in the IT sector of 11%, noting that sector weakness is entirely the result of a sector de-rating to multiples “in the low 20s. We didn’t expect the scale of the pullback.” MoneyWeek |
Anyone have any idea if the move to 'e sims' will have any affect on CLX or is that just a problem for the operators?
thanks |
Calnex could gain some further interest on the back on todays tip in The Sunday Times for Spirent !
"Last month, its order book stood at a record $283m..... customers include governments, and all of the world’s ten largest tech firms. It is already working in the high-speed ethernet 800G market, striking a deal to use its new test platform with a major equipment maker. The business is recession-robust, if not proof: whatever the outlook, governments are investing in 5G to protect their competitiveness. It’s well-tested technology: buy Spirent."
Complete article here: |
Cheers Mas.
CLX are also featured nicely in the new issue of Shares Magazine just out. They have a table of the best performing IPOs since March 2020. CLX are 5th in the overall list, with a again of 225%, but are actually the best performing IPO of all if you strip out the top four which are all resource/oil companies.
They note:
"CALNEX PASSES THE TEST
Shares in little-known telecoms testing kit maker Calnex (CLX:AIM) have climbed 225% to 156p since the Linlithgow-headquartered company braved pandemic markets by listing its shares on the AIM market in September 2020 at 48p.
A global leader in the telecoms network testing space, Calnex’s distinguished list of customers includes BT, Ericsson (ERICB:ST), Nokia (NOKIA:HEL) and Intel (INTC:NASDAQ) and share price strength comes against a backdrop of continued high demand for the company’s range of test and measurement solutions.
Calnex is benefiting from supportive market trends with the transition to 5G and growth in cloud computing, the order book remains strong and the company’s broad spread of products and global markets clearly has appeal for investors.
Full year results showed another strong year for Calnex, with revenue of £22 million coming in 8.9% ahead of Cenkos’ £20.2 million forecast and pre-tax profit up 64% to £6 million. As the broker commented on 24 May, ‘the long-term macro driver of the transition to 5G and continued growth in cloud migration is also expected to continue to drive demand from both new and existing customers and the record order book as Calnex entered full year 2023 provides a strong outlook with continuing strong sales momentum’." |
Good spot, Riv. |
This is from CLX's AIM admission prospectus - whatever portion of dollar revenues are unhedged should provide very good gains for CLX considering the weakness of the pound:
"Exchange rate movements
The Company’s reporting currency is UK sterling. The majority of orders, circa 85 per cent. in FY20, were received and settled in US dollars. Fluctuations in currency exchange rates, in particular sterling to US Dollar exchange rates, could have a material adverse effect on the Group’s business, revenue, financial condition, profitability, prospects and results of operations" |
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