Advanced Computer Software makes its numbers add up, Innovision stakes its claim to the future and IS Pharma sweetens the pil

Advanced Computer Software (LON:ASW) -Advanced Computer Software, a leading provider of software and IT services to the primary care and commercial sectors, has announced its full year results for the year to February 2010. The group has grown aggressively by making four acquisitions in the past year and the reported numbers reflect this programme. Revenues were up 312 per cent to £30.2m (2009: £7.3m) and pro forma revenues (assuming the acquisitions were made on 1 March 2009) would have been £91.5m, generating pro forma EBITDA of £21.7m. Adjusted reported EBITDA was up 249 per cent to £7.2m (2009: £2.1m) and profit before tax up 281 per cent to £4.2m (2009: £1.1m). Net debt stood at £41m following a loan facility of £55m agreed with HSBC/ Royal Bank of Scotland comprising a £25m term loan and a £30m revolving facility. The company has fire power of a further £30m-£40m for acquisitions this year and we’d expect 3-4 deals depending on size. We attended a management presentation and were impressed with the vision and determination of Vin Muria, CEO. The acquisitions to date have been made on an average EV/EBITDA multiple of 8x and management took us through a detailed exposition of the areas of revenue and cost synergies.

ASC also announced it has secured a 5 year contract with Pfizer to provide a SaaS hosted software solutions to support the clients’ new Vascular Health Check service. The value of the contract has not been disclosed, but it highlights the group’s ability to reach new markets by redeveloping existing products.

The market forecasts a significant uplift in 2011- PBT and EPS of £17.3m and 3.2p respectively. Trading on a 2011 earnings rating of 11.3x, a discount to its peers, we recommend advancing towards this stock apace.

Angel Biotechnology Hldgs (LON:ABH)

Having written about the exciting prospects for Angel Biotech over the last two weeks, it was very pleasing to see the company announce a trading update on the 3rd June. The most significant feature by far is that Angel expects to make it’s maiden profit in H1 2010. The losses for the first three months of the year were much reduced, with a net profit reported in April…

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