Speedcast International Limited (ASX: SDA) has a core business vision to be a leader in the provision of remote communications and IT services worldwide by focusing on creating value for customers through delivering high quality, innovative and tailored solutions with exceptional customer service. Key to the strategy is the ability to retain the flexibility to react to changes in customer needs and industry trends. The company provides product & services including Network Services, Value Added Services, Equipment Sales, Wholesale Voice, Professional Services and System Integration.
On December 31, 2018, Speedcast International Limited (ASX: SDA) has announced the resignation of Mr. Edward Sippel as a Director of the company with effect from 31 December 2018. The chairman, Mr. Pierre- Jean (PJ) Beylier, has appreciated the valuable services of Mr. Edward Sippel for five years as a member of the Board of the Company. Following the release, the share price of the company increased by 2.105% on December 31, 2018.
The company recently has updated its expectations on the full year underlying EBITDA number for 2018. It stated that it expects the underlying EBITDA to be approximately in a range of US$130 million to US$135 million, which is slightly below the current consensus. The company however previously communicated its expectation for the underlying EBITDA to be approximately around US$135 million to USD$145 million. This change is primarily due to the renewal of carnival taking longer than expected time, the energy sector underperformance and slower implementation of new project win in EEM. The company has noticed activations exceeded churns from June to November as well as prospects for further growth in FY 2019. The revenue from the energy sector is expected to grow US$76 million in the first half of 2018 to ~US$82-84 million in the second half of 2018, marginally lower from the previously communicated range. This is due to the slower implementation of existing projects and due to decision making for new projects in the pipeline than anticipated.
The CEO of the company Beylier stated the company is pleased with the renewal of the carnival contract. This will help in generating strong revenue growth over the next coming three years and will also improve the performance of the energy business, which is positive since the company has already faced challenges and energy and cruise have impacted the performance of the company in the face of a challenging year. He also mentioned that the company is excited about the future growth following the integration of Harris Caprock and the momentum it has gained in its four divisions with a win in market share in the second half of 2018.
The stock of Speedcast last traded at $2.910 with a current market capitalization of $682.37 million. The company posted a negative YTD return of -45.40% and a negative return of 54.25% over the last six months period, with a 52-week high and low of $6.830 and $2.810, respectively. It is currently trading at a PE multiple of 44.530x with an EPS of AUD 0.064.