Jsjs Designs (LON:JSJS) (JSJS, 1.75p, £4.47m) has received confirmation that a leading retailer will continue to stock JSJS’ Room Control products. The news is encouraging following the refinancing and board changes – we maintain the HOLD for the time being.
Kewill (KWL, 97.25p, £87.75m), the provider of software solutions, reports interims to 30 September 2010. Revenues increased by 6% to £28.9m (h109: £27.2m), of which 62% was recurring. Tighter cost control drove adjusted operating profit up 12% to £4.2m (H109: £3.7m) and adjusted EPS up 11% to 4.6p (H109: 4.2p). A 6% increase in the interim DPS to 0.37p (h109: 0.35p) highlights the Board’s confidence in cash generation (net cash £12.3m) and future profitability. Despite the uncertainty in the economy, the sales pipeline is strong. We believe there is scope customers may start to delay their investment decision making in the current environment. The group seek strategic acquisitions to broaden its geographical coverage and complement the existing solutions for global trade and logistics. The market forecasts 2011 PBT of £9.6m, EPS of 10.16p and DPS of 1.32p. Trading on 9.6x 2011 earnings with a prospective yield of 10.4% suggests the group is undervalued, given its strong recurring base. We reiterate our BUY recommendation and our target price of 119p.
Planet Payment Inc (LON:PPTR) (PPT, 89.5p, £29.20m) Q3 results to September 2010 saw revenues rise substantially to $15.54m ($11.75m) with the multicurrency processing revenues surging to $12.47m ($8.51m) offsetting other processing revenues that fell slightly to $3.07m ($3.24m). Gross profits rose to $5.03m ($4.12m), a margin of 32.4% (35%), with an increase in operating expenses to $5.19m ($4.62m) limiting the group to merely reducing the op losses to $0.15m ($0.51m) and a significant reduction pre-tax losses to $0.45m (loss $0.81m). The group ended the period with net debt of $7.99m (net debt of $5.28m at the Dec year end) post $0.4m cash raise from stock – thought he group placed $6m post September so cash is not a short term issue. Importantly the group is seeing the continued roll-out of its services with 3,800 active merchant locations added over the year with 46 banking and processing customers. Q3 saw the group start the roll out start in Canada, United Arab Emirates, Philippines, Singapore, Brunei, Sri Lanka, the Maldives and South Africa. With…
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