CyanConnode forecasts spurt in H2 revenues
IoT technology enabler CyanConnode recorded higher than expected interim revenues in the six months to June 30 and expects second-half revenues to “materially accelerate.”
The UK share price rose fractionally on the news, contained in a bullish trading update. The business specialises in narrowband radio mesh networks. During the first half, the company continued to grow its product portfolio and geographic reach while further strengthening relationships with existing clients through fulfilment of its order book.
As a result of its broader geographic reach and the growing size and scale of the order book, the company realigned its delivery processes to ensure order fulfilment forecasts were met during the period; this produced its highest ever first half revenue performance.
CyanConnode expects H1 2018 revenues of £1.6 million, which is 37 per cent higher than for the entire FY 2017 with India being the main contributing region.
H1 2018 operating loss before tax is expected to be in the region of £3.3m – a significant improvement over the pre-tax loss of £11.15 million for FY 2017.
Operating margins were expanded as a direct result of the reduction in overheads with further cost savings expected during the second half for the current financial year. The Company ended the period with £2.8m of net cash, including £1.4 million from R & D tax credits.
The company has previously stated that H2 2018 revenue will be substantially larger than H1 2018 based partly on contracts already won and already in the delivery phase and partly on new orders expected for hardware to be delivered. Management still believes this will be the case.
Executive chairman John Cronin (pictured) said: “The board is focused on providing returns to shareholders and has taken a number of steps to ensure the company moves to a position where it can generate profits as revenues grow.
“We believe that the steps we have taken in recent months and the opportunity ahead mean that we will be able to deploy further significant contracts as we convert our order book.”