Last week on 27 November 2018, an announcement was made by the Energy One Limited (ASX: EOL) about its definitive agreement to acquire Contigo Software from the Trayport Limited whose transaction was expected to complete by 30 November 2018. The Contigo Software has the potential to provide solutions related to energy trading risk management (ERTM) to the European customers.
Now, as per the latest update, the company has completed the transaction which results in the acquisition of the Contigo Software (UK). In order to complete the transaction, the company made a payment of £4 million in the form of cash which it derived from a debt of A$7.3 million from Westpac Banking Corporation and the remaining amount from the cash reserves of the company.
The company expects that in FY20, the acquisition of this software will generate an additional revenue of £4 million and EBITDA of £0.6 million. The company further expects a one-off acquisition cost which needs to be accounted, as it is an offshore acquisition, therefore, the transaction costs related to the acquisition of the software will be higher than its earlier acquisitions. However, the company is positive that this cost will be balanced by the revenues from Contigo business unit.
Since its inception, the performance of the company remains positive. However, since the last 3 months, the performance of the company is negative.
Since the company got listed into ASX, the performance of the company was 578.57%. Over the last 5 years, the performance of the company is 413.51%. Since last year, the performance of the company is 10.47%.
For the year ended 30 June 2018, the company made a net profit of $1,040,343. The company holds a net asset of $7,094,114 which suggests that the company is in a position to meet its long-term obligations. The total current asset of the company is $2,733,291 and total current liabilities of $4,324,552 which signifies that the company is not in a position to meet its short-term obligations as well as the working capital. The total shareholder’s equity is worth $7,094,114.
From the operating activities of the company, there was a net cash inflow of $3,187,707. Here, the main source of cash inflow was from the receipts from the customers. Simultaneously, there were also cash outflows where the company had made payment to the suppliers and the employees and other finance costs.
From the investing activities of the company, the net cash outflow was $1,156,829. Here, the main source of cash outflow was due to the payment done in the form of software development cost. The company also acquired businesses which was another source of cash outflow. Further, there were payments made to purchase of plant, property, and equipment as well as intangible assets.
From the financing activities of the company, the net cash outflow was $1,665,589. Here, the company had made the repayment of the borrowings and also paid the dividend. By the end of the year, the net cash available with the company was $727,856.
By the end of the trading on 04 December 2018, the market price of the share increased by 5.263% with the last traded price of A$1. The stock reported a market capitalization of A$20.24 million and PE ratio 18.41x.
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