Record Financial Performance in FY 18: Hansen Technologies Limited’s (ASX: HSN) stock rose 3.7% on August 17, 2018 after the company delivered 35% growth in NPAT to $38 million and 32% rise in operating revenue to $230.8 million. This is on the back of strong performance of acquired Nordic based Enoro, which contributed A$57.7 million of operating revenue during the year 2018. HSN had acquired this business for an enterprise value of A$94.7 million, and its performance in 2018 has exceeded HSN’s expectation.
The acquisition of Enore marked the ninth earnings accretive acquisition during last 10 years, and is the largest acquisition of the company to date. HSN during FY 18 has generated $39.4 million of free cash flow and paid down significant amount of debt, which brought the debt of the year to $4 million. Additionally, HSN has declared a final fully franked dividend of 4 cents per cent, including special dividend of 1 cent. Meanwhile, HSN for FY19 expects higher underlying recurring revenue and the effective tax to be approximately 24%. However, for FY19, the total operating revenue is expected to be below FY 18, total revenue to be subdued and expenses to be in line with FY 18 as the company is investing in global platform for future growth. The total operating revenue will be lower in FY 19 due to termination of underperforming contract within the US solutions business that will result in the loss of approximately $1.9 million of revenue in FY 19 compared to FY 18. In addition, HSN achieved a low level of non-recurring license fee and service revenue compared to the level achieved in 1H 2018. HSN stock has fallen 24.78% in three months as on August 16, 2018 and is trading at a P/E of 22.62x.
FY 18 Financial Performance (source: Company Reports)
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