Kape Technologies Share Discussion Threads

[crazycoops] 26/3/2018 18:09

I see KAPE are presenting @mello2018 this month

[mfhmfh] 26/3/2018 14:03

new highs now...looking for 100p. GLA.

[otemple3] 22/3/2018 21:14

Thanks BUYING - surprised he moved the price more than ST did but happy either way.....

[buying] 22/3/2018 21:02

The naked trader bought in and people follow him

[ny boy] 22/3/2018 21:02

Like the look of these, will have a punt for the long term, if (IMM) phase 3 results for Lupuzor are top line, will know in the next few weeks, if so, will park some cash here.

[rivaldo] 19/3/2018 11:09

Mentioned this morning by Allenby Capital:



"Kape Technologies (formerly Crossrider) plc (KAPE.L, 82p/£116.3m) Prelims: Transition to own product sales and upsell opportunity (13.03.18)

• Revenue +17.4% to $66.4m and adj. EBITDA +29% to $8.3m with EBITDA margin improving 120bps to 12.5%. Underlying adj. EBITDA (excluding Web Apps and Licenses) increased 172% to $6.2m. This is slightly above and in line with January's trading update, respectively.

• Adj. cash from operations of $7.6m, representing 92% of adj. EBITDA (FY16: 123%). Year end cash of $69.5m (FY16: $72.1m), after $7.4m of acquisition related spend (CyberGhost) and the board is proposing a special dividend of $7m, equivalent to 3.55p/share.

• Integration of CyberGhost (Virtual Private Network software) now complete including Kape's user acquisition platform and it has performed ahead of management expectations, contributing $1.5m of net profit.

• 21% growth in paying users to 887k (now >900k), 82% growth in premium subscriptions to 260k and management expects $8m of recurring income from existing users in 2018. Subscription retention rate of 69%. Management expressed confidence in achieving FY18 expectations ($74.1m revenue and $10.1m adj. EBITDA).

Acquisitions in the fragmented cyber security market will feature on top of this. Allenby Capital comment: A good set of numbers as the company moved up the value chain to distribute its own consumer cyber security products rather than third party products. The shift in business offers higher margins and the potential for recurring revenue. The company has a proven digital distribution and online marketing platform and management plans to ramp up marketing spend to c. $3m per month on customer acquisition. Once acquired, Kape will look to retain and upsell customers with a range of products through a process of buy and build in the fragmented cyber security space.

Valuation is heavily skewed by the substantial cash pile but stripping this out, the EV/EBITDA rating (7.7x FY18) is not demanding."

[rivaldo] 19/3/2018 08:18

Looking good chart-wise now, and busy this morning with a series of buys in the first few minutes of trading. Tipped somewhere?

[rivaldo] 15/3/2018 23:03

Managed to get hold of the text of the tip anyway (thanks mate) - here it is:

"Profiting from cyber security

Crossrider, a provider of cyber security software, has just changed its name to Kape Technologies (KAPE:78p) to reflect the change in the business in the past year.

Employing 350 staff across seven locations globally, the company offers four main products to 887,000 customers: Reimage, a patented Microsoft-based product tool that enables users to clean up their computers; DriverAgent, a PC maintenance software products company offering a leading device driver search and update service, which scans computers for outdated drivers; and Cyberghost, a cyber security provider of secure virtual private networks (VPNs) which securely pass data traffic over public networks.

It’s proving a profitable area to be operating in as the global cyber security market has grown from $3.2bn to $120bn in size in the past 13 years. Kape is reaping the benefits: premium subscribers surged by 81 per cent to 260,000 last year, buoyed by the Cyberghost acquisition, which posted 30 per cent growth in premium customers and now accounts for 187,000 of the total. They are proving loyal as 69 per cent renewed their subscriptions last year, hardly surprising given that 689m people were victims of cybercrime in 2016 and $16bn was lost to ID fraud. More than 40 per cent of working Americans have now installed a VPN on their laptop to encrypt their data and provide a secure internet connection.

Moreover, Cyberghost has been outperforming guidance, posting a net profit of $1.5m in 2017, or 50 per cent more than forecast at the time of the acquisition in March 2017, making the $9.6m maximum consideration paid a bargain. Driver Agent, acquired for $1m, posted annual cash profits of $0.6m. This helped Kape deliver an eye-catching 30 per cent hike in cash profits to $8.3m on revenues 17 per cent higher to $66.4m.

Interestingly, chief executive Ido Erlichman told me during our results call that complementary acquisitions are being “actively considered”. The board can easily afford to as the balance sheet is awash with cash. Net funds of $69.5m dipped by only $2.6m last year, even though Kape made $7.4m of acquisition-related payments. That’s because the business converted an impressive 92 per cent of cash profits into operating cash flow. Shareholders are getting their share as the board has just declared a special dividend of 3.55p a share to return $7m of the excess cash.

The positive momentum across all business segments has continued into the new financial year. Mr Erlichman revealed that the roll-out of the Reimage subscription model is “far better than we expected” and that in a recent cross-selling promotion to Cyberghost customers “nine out of 10 signed up for Reimage.” A new Reimage product for Mac users offers potential to boost the user base too.

Having posted a record cash profit performance in the final quarter of 2017, current monthly revenue is at record levels, supporting forecasts of cash profits rising from $8.3m to $10.1m to deliver a 36 per cent hike in both pre-tax profit and EPS to $9.1m and 5.2¢ (3.7p), respectively, in 2018.

Rated on 11.5 times forward earnings after adjusting for 35p a share cash on the
balance sheet, I have a 100p target price, or double the 48p entry point in my 2017 Bargain Shares portfolio. Buy"

[mfhmfh] 15/3/2018 17:11

Can't copy/paste the article from my phone.

[rivaldo] 15/3/2018 15:55

Cheers mfhmfh. Got any further details?

Here's the new Kape web site for the record:

[mfhmfh] 14/3/2018 13:05

Buy recommendation reiterated by ST in IC. 100p target price.

[igoe104] 13/3/2018 14:43

GOOD write-up here.


Why I believe these 2 secret growth stocks are set to outperform in 2018 and beyond

[igoe104] 13/3/2018 14:32

After being impressed with todays results, and seeing the size of the cash-pot, future prospects and talk of a special divi, I've been doing some digging.

I must admit of never seeing these before, but seeing a lot of very extremely creditable investors on this and the old forum, has added to my confidence to invest. so I've dipped my toes with a 20k plus buy at 77.3p

[cheshire man] 13/3/2018 12:17

Well done setting up the thread rivaldo :-)

[rivaldo] 13/3/2018 10:50

Cheers everyone. Yep, the special divi was a pleasant surprise.

New note out from Progressive Research - they see 5.2c EPS this year rising to 7.1c next year.

They also see $71.1m cash at the end of this year rising to $81.5m next year - though I'm sure there'll be earnings-enhancing acquisitions in the meantime:

[battlebus2] 13/3/2018 10:24

Thanks for the new thread Rivaldo, surprised to get the special dividend and we look in great shape for future growth 👍

[otemple3] 13/3/2018 08:25

Thanks RivaldoAgree, looks good and special dividend is a nice touch (although don't hold in my isa!).

[rivaldo] 13/3/2018 08:23

I thought I'd start a new thread given the change of name. I'll try to refine the thread header post at some point.

Good results today methinks.

[rivaldo] 13/3/2018 08:20

"Kape is a leading 'privacy-first' digital security software provider to consumers. Through its range of privacy and security products, Kape focuses on protecting consumers and their personal data as they go about their daily digital lives.

To date, Kape has over 2.6 million paying subscribers, supported by a team of over 420 people across eight locations worldwide.

Through its subscription-based platform, Kape has fast established a highly scalable SaaS-based operating model, geared towards serving the vast global consumer digital privacy market."



It's worth noting that over 87% of 2020's total revenues were recurring......

Latest research from Progressive Equity Research dated 20th July 2021 (Shore Capital are the house broker and have their research available via Research Tree):



Forecasts are for 25.3c EPS for 2021 rising to 32.4c EPS in 2022 incoporating a full year of the March '21 Webselenese acquisition - a forward P/E at 355p of only 15.1, which is a very low multiple compared to cybersecurity sector comparator companies.

IMO there is ample room for significant upside for KAPE from 355p given (a) organic growth (b) global sector growth (c) likely further earnings-enhancing acquisitions and (d) acquisition synergies/cross-selling opportunities.

KAPE have now proven over time that they are extremely capable of achieving both above average organic growth and effective integration of and growth in acquired companies.

I bought most of my stake at around 66p and the rest at up to 90p. I intend to retain these for some time to come (and may well add more) unless something dramatic happens.