IMImobile M&A relieves its debt – Investors’ Chronicle


IMImobile(IMO) ‘s gross profits for the six months to September 2019 increased 21% to £ 35.2million, resulting in a five year compound annual growth rate of 21%. This reflects improvements across all geographies and strong revenue performance – supported by an 18% increase in organic revenue.

True, the cloud communications software group has grown significantly from £ 7.5million to £ 21.8million. But that reflected the $ 53.2million (£ 41million) acquisition of US cloud-based mobile customer engagement platform 3Cinteractive, announced in July. In addition to the drawdown of new credit facilities, the transaction was financed by a placement of $ 20 million.

The group claims that 3Cinteractive has strengthened IMImobile’s presence in North America and allowed it to become the world leader in rich communications services (“RCS”) business messaging – a market which, according to one estimate, could reach £ 16.2 billion. in 2023. Managing Director Jay Patel notes that IMImobile’s team in North America now numbers around 150 people – “a sufficient size of workforce in this market to make it a success.” The group no longer sees the need to buy in this market, even if it will continue to seek acquisitions. At this point, after the period ended, the group bought Rostrvm – a UK-based contact center software provider – for up to £ 3.5million.

Real estate broker Investec expects EPS of 3.9p for fiscal 2020, compared to 2.6p for fiscal 2019.

IMIMOBILE (IMO)
ORDER PRICE: 314p MARKET VALUE: £ 233 million
TO TOUCH: 310-317p UP TO 12 MONTHS: 340p LOW: 203p
DIVIDEND RETURN: nothing P / E RATIO: n / A
NET ASSET VALUE: 106p * NET DEBT **: 27%
Semester as of Sept. Turnover (£ m) Profit before tax (£ m) Earnings per share (p) Dividend per share (p)
2018 67.2 1.16 -0.20 nothing
2019 83.0 1.30 1.00 nothing
% cash +24 +12
Ex-div: n / A
Payment: n / A
* Includes intangible assets of £ 123 million, or 166 pence per share


Carol M. Barragan