Altium Limited’s Stock Skyrocketed After The Company Posted Strong Result For 1HFY19

Altium Limited’s Stock Skyrocketed After The Company Posted Strong Result For 1HFY19

Information Technology company Altium Limited (ASX: ALU) posted its financial results for the half year ended 31st December 2018, after which the stock flared near to its 52-week high of $33.640.

The Company’s revenue, excluding interest income, increased from US$63.23 million in the first half of FY18 to US$78.11 million in the first half of FY19, which represents a healthy growth of 24% in a year. Most of the company’s revenue growth was driven by China alone with a 49% increase compared to previous corresponding period along with all other regions and segments delivering double-digit growth.  [optin-monster-shortcode id=”swikrbu1d9j9aq0o4cko”]

And the growth story does not halt here! The management has also given future guidance of ramping up the revenue even higher from here and is expected to hit US$200 million by 2020 and US$500 million by 2025.

The EBIDTA stood at US$28.36 million as compared to US$18.98 million a year ago with EBIDTA margin going up from 30% to 36.3%. The guidance for the EBIDTA margin has been kept around 35% for 2020

The major credits for the outstanding performance of the business also goes to the increase in the subscription pool which grew by 9% to 39,179 and is expected to touch 100,000 by 2025 as stated by the management. This will reportedly be done by investing in next generation marketing and business systems and by scaling aggressively in China and USA to lay a strong foundation for accelerated growth. Operating cash flow has also increased at an astounding rate of 80% from $14.83 million to $26.81 million a year ago.

A significant improvement is seen in the profit after tax where the company delivered a massive 58% increase from US$14.87 million to US$23.44 million in just a year. This has resulted in almost equivalent increase in the earnings per share (EPS) of the company which rose by 57% from 11.48 cents in 1HFY18 to 18 cents in 1HFY19

An interim dividend of 16 cents for the half year ended 31st December 2018 has also been announced which is an increase of 23% from the interim dividend declared a year ago. The record date, ex-dividend date and payment date for the dividend is 4 March 2019, 1 March 2019 and 27 March 2019 respectively.

Altium CEO, Mr Aram Mirkazemi’s positive statements about the future scalability of the business and commitment towards the consistent and sustainable growth over the long term helped to boost investors’ confidence which resulted in massive increase in stock price.

On 19th February 2019, the stock price closed significantly higher at $32.56, reflecting intra-day change of +20.2%. The stock continues to move in the same trend on 20 February 2019, up 1.873% to trade at $33.170 (12:27 PM AEST). ALU is currently trading at a Price to Earning ratio of 65.340 x with a market capitalization of $4.25 billion.

Over the past 12 months, the stock has massively gone up by 81.68% including a positive price movement of 14.65% in the last three months.


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